Probate Real Estate Sales: What You Need to Know
When someone passes away and leaves behind a house, the probate court steps in to decide how the property will be sold. This process can be either formal or informal, and the way itâs handled can make a big difference in how long it takes to sell the home.
What You Need To Know About Probate and Real Estate
In this article, we will outline key information about the probate process, including:
- What probate means
- How to sell your house in probate
- The different types of probate
- Why you need an expert on your side
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The Different Types of Probate and How Long They Take
Understanding the different types of probate and the rules that apply to each process is crucial. In West Michigan in 2024, there are two main types of probate: formal probate, which is a longer process, and informal probate, which is simpler and faster.
If youâre trying to sell a home in probate, having an informal probate can make the process easier. However, that doesnât mean you canât sell a house in a formal probate processâit just requires a bit more time and patience. Letâs break down the differences between the two types of probate.
Formal Probate: A Longer Process
In a formal probate process, the court must approve every step of selling the house. This means the sale can take longerâoften more than six months. The person in charge of the estate, called the executor, will usually need to hire an attorney to help with the sale.
Before the house can be sold, the executor must get the property appraised. The appraisal sets the asking price, and the court requires that the house sells for at least 90% of this value. Once the appraisal is done, the executor asks the court for permission to sell the house. If approved, the house is listed as a probate sale.
When someone makes an offer, another court hearing is scheduled. During this time, the sale must be advertised in a local newspaper with the offer price, allowing other buyers to bid on the house at the hearing.
The Final Court Hearing: Sealing the Deal
At the court hearing, other buyers can show up and place their bids. The original buyer can also bid again. The court oversees this process, with strict rules in place. For example, the first new bid must be at least 105% of the original offer plus $500. Any following bids must increase by $5,000 to $10,000. The court will then confirm the final buyer, and the executor can complete the sale.
Informal Probate: A Simpler Process
Sometimes, the probate court allows a simpler process known as informal probate. This usually happens when the house was co-owned with someone else, like a spouse, or when the property was in a living trust. In informal probate, the executor doesnât need to jump through as many hoops, and an attorney isnât required.
The executor starts by filing the will and other paperwork with the court. The court then issues documents called Letters of Testamentary, which give the executor the power to manage the estate. After that, the executor can list the house for sale and sell it like any other property, without the court needing to get involved. This process is faster and less complicated than formal probate.
Why You Need a Probate Expert on Your Side
Navigating the probate process can feel overwhelming, especially if youâre the executor or a beneficiary of the estate. While you can handle the estate sale on your own, working with experts like City Lights Rentals can save you time, money, and stress.
City Lights Rentals is a trusted authority in probate real estate sales in West Michigan. We understand the ins and outs of the probate process and can guide you every step of the way. Whether youâre dealing with a formal or informal probate sale, our team is here to help make the process as smooth as possible.
If you have any questions about selling a house in probate, or if youâre ready to get started, contact City Lights Rentals today for a free consultation. Weâre here to help you navigate this challenging time with ease.
Contact A Probate Expert:
If youâre navigating the probate process and feeling uncertain about the next steps, now is the perfect time to reach out to an expert. At City Lights Rentals, weâve successfully guided many homeowners through both formal and informal probate sales. Our team understands the unique challenges of selling a home during probate, and weâre here to help you every step of the way.
Donât let the complexities of probate overwhelm youâlet us make the process smoother and more manageable. Contact us today for a free consultation, or learn more about how we can assist you with your probate real estate needs. Visit our website at CityLightsGrandRapids.com to find out more.
