When a loved one dies, there is an understandable period of grief and acceptance after which the heirs of the deceased will have to decide upn the distribution of the deceased’s assets.
Included in those assets might be a house belonging to the deceased, which the heirs will want to sell to pay off debts the deceased owned.
Selling a house in itself can be a lengthy and costly process. Selling a house in probate can add a lot of other steps to that standard process.
What Does It Mean To Sell A House In Probate?
Probate is a process through which a court distributes the deceased’s assets fairly to heirs and beneficiaries.
A property will go to probate regardless of the previous owner leaving a will or otherwise.
If there’s a will, the court will assign an ‘executor’ to carry out the property specific instructions in the will, and if there’s no will present, the court will appoint an ‘administrator’ to determine how to proceed with the process of probate subject to legalities and requirements.
How Does A Probate Process Work?
The process for selling a house in probate in Texas will largely depend on the circumstances surrounding the distribution of assets.
- Did the decadent (person who’s property is in probate) have any debts to fulfill?
- Did the decadent leave a will specifying how distribution must be done?
- Are there any other beneficiaries who must be paid?
- Are there taxes to be paid?
- How many heirs will the property be distributed to (and affidavit of heirship will be required while filing at the court if their is no will present).
… will need to be answered and determined before going ahead with the probate process.
Laying out what you’re working with will streamline the process and help you decide whether you need to involve an attorney or not.
Even if the case is simple, you may choose to conduct the process through an attorney to have as little hassle as possible.
Under texas law, you do not need to an attorney to sell a property in probate, but because of person selling the property requiring sound knowledge of the law, hiring a lawyer may be the obvious choice.
Step 1: File for Probate
The first step to sell any real estate in probate is to apply for probate in the Texas county where the decedant resided.
You will also need to provide the death certificate and a list of the deceased person’s assets and debts. Once you have filed the petition, you will be given a hearing date by the probate court.
Step 2: Public Notice
Once you’ve submitted your probate application, the country clerk will give notices both online and present within the court premises to notify anyone who may wish to contest the will before the court proceeds with the probate hearing under the probate law.
If no one contests the will, the court will move forward with the administration of the will (if present) of the distribution assets/house if otherwise.
Step 3: The Hearing
On the day of the hearing, you will need to go to court and present your petition to the judge. The judge will review the petition and determine if the will is legally valid, and the judge will also have to approve of the executor named in the will. If there is no will, the court will appoint an adminstrator to determine and distribute the assets or sell the house.
The court will also determine how the house will be sold:
Dependent Administration: Where everything is micromanaged by the court i.e the selling of the house and other assets and the dispensing of liabilities.
Independent Administration: The court will appoint an admistrator to oversee the process of the selling of the decadent’s assets. The administrator legally has the power to dispense of the decadent’s assets as he deems fair and according to law.
Step 4: Listing the Estate’s Assets
Once you have been granted authority to sell the property, the executor or administrator will need to list all of the estate’s assets for sale. This includes any personal property, such as furniture or vehicles, that may be located on the premises.
You will also need to have the property appraised so that you can set a reasonable asking price.
Step 5: Identify the Heirs and Beneficiaries
Before you can sell the property, you will need to identify all of the heirs and beneficiaries of the estate. Heirs are people who are entitled to inherit property under state law. Beneficiaries are people who are named in the deceased person’s will as being entitled to receive a portion of the estate.
You will need to provide a list of the heirs and beneficiaries to the court so that they can be notified of the sale.
Step 6: Debt and Creditors
A list of debts owned will need to be established who will be paid from the sale of the house and other assets. Once all debts and creditors have been paid, only then can you can distribute the remaining funds to the heirs or beneficiaries.
Step 7: Claims and Disputes
If there are any claims, grievances, or legal disputes against the estate, they must be resolved before the property can be sold. Claims can be made by creditors, heirs, or beneficiaries. Once all claims have been resolved, you can proceed with the sale of the property.
What Does Filing For Probate Cost?
The exact cost is determined by the circumstances surrounding the sale.
If there are no debts or outstanding, the the only remaining cost is a probate application fee, which can be between $200 – $300.
Other costs (and circumstances):
- If there’s no will then a you will need to file an Application to Determine Heirship, which may cost between $300-$400.
- The deposit for a state-appointed attorney will cost about $400
- Providing there no debts or disputes and you wish sell a property immediately, you will need to file an Application for Sale of Real Property which can cost up to $250.
The average cost for a probate filing and administration is $1500 in Texas. If you are the executor of the probate application, you will most likely need to take care of the holding and maintenance costs of the house while it is in probate. That can be everything from taxes, bills, maintenance and repairs and landscaping.
What Are The Options To Sell A House In Probate?
After the court has allowed the executor or administrator to sell the house, you (as an executor) might be wondering what options you have to get the house off your hands.
Sell To A House Flipper
A House Flipper will buy the house in whatever condition it is and then sell it forward to other buyers after making the needed repairs and renovations. This option is especiall helpful when the property you are looking to sell needs majoe renovations and was not maintained properly in the past years due to being vacant (a second home or something similar).
House flippers will usually buy a house under favorable conditions:
- The house is located in an area which is in high demand with buyers.
- It has more cosmetic repairs then major renovations.
- It has great aesthetic value that may help them selling it for more.
Sell To A Cash Buyer
A cash buyer means just that: they’ll purchase your house in cash without the need for taking loans or mortaging. Similar to house flippers, cash buyers don’t charge real estate agent commissions and may even help with closing costs. They also buy houses in preforeclosure, properties on sale due to divorce or bankruptcy.
Pros of Selling To A Cash Buyer
- Quicker Sale: Having the required cash at their disposal, you can make the sale instantly, without having to worry about dealing with different buyers who each come to inspect the property and the process can take unnecessarily long because of that.
- Less Uncertainty: Cash buyers usually go forward with buying a property when they’re completely certain it’ll be a good investment, Once they’ve committed, you can be pretty much sure that your house is as good as sold, without worrying if they’ve reconsider and refuse two weeks down the line.
- Fewer Hurdles: This basically deals with the number of people involved with the sale. With cash buyers, there’s no buyer chain you have to deal – rather, just one company. This also means the buyer won’t have to worry about mortgages – because he already has the cash to buy your property outright.
These are usually experienced buyers who look to invest in property with the aim of maximum capital gain. They may make repairs or renovations before selling your house to another buyer.
You may have to pay agent commissions if one brings a property investors to you.
Selling a home in probate in Texas can be a very simple process if you have sound knowledge of probate law or if you choose to appoint a probate attorney to go through with the administration.
We hope this article helped guide on how exactly to sell a house in probate in Texas.