June 7, 2023
Hello, and welcome to our blog! If you are reading this, chances are you are in a position where you may need to sell the assets of a loved one. While not a particularly fun topic, it's an important one and something many of us have to deal with at some point in our lives.
If you have been named the executor of the will, you're in charge of handling the probate process. Probate is basically the legal way of settling an estate and distributing the assets to the beneficiaries. It can be a long and complicated process, depending on the size and complexity of the estate. But don't worry, you don't have to do it alone. There are different options available to help you sell the property and make things easier for you and your family.
When starting this process, you might be wondering what it entails and how probate differs from a regular sale.
Probate sales are overseen by the court, and they can be either confirmed or non-confirmed. The difference depends on whether the executor of the estate has the authority to sell the property without court approval, which is granted by the Independent Administration of Estates Act (IAEA). Click to jump to that section.
First, I'm going to share with you 5 ways to conduct a probate sale in California. These are:
This is probably the easiest and most convenient way to sell a probate property. You can hire a real estate agent who specializes in probate sales and let them handle everything for you. They will list the property, market it, negotiate with buyers, and handle all the paperwork and legal formalities.
The advantage of this option is that you can get professional guidance and support throughout the entire process. The disadvantage is that you have to pay the agent's commission, which in San Francisco is around 5% of the sale price.
Another option is to sell the property privately, without listing it on the market. This can be done by working with an attorney who oversees the sale. The attorney will solicit sealed bids from potential buyers and present them to you. You can then choose the highest bidder and accept their offer.
The advantage of this option is that you can save on commission fees and avoid exposing the property to the public. The disadvantage is that you are likely to not get the best price for the property, as there is less competition among buyers.
A third option is to sell the property through a public auction. This involves hiring an auctioneer who will advertise the auction date and time, and conduct the bidding process. Anyone can attend the auction and bid on the property vocally.
The advantage of this option is that you can sell the property quickly and avoid any contingencies or inspections from buyers. The disadvantage is that you have to pay the auctioneer's fee. You also have no control over who buys the property or how much they pay for it.
A fourth option is to sell the property through a court confirmation. This is similar to a private sale, except that you need to get approval from a judge before accepting any offer. The judge will review the offer and determine if it's fair and reasonable. If there are any objections from other parties, such as creditors or beneficiaries, they can also be heard by the judge.
The advantage of this option is that you can ensure that the sale is legally valid and avoid any disputes or lawsuits later on. The disadvantage is that you have to go through a lengthy and costly court process, which can take several months or even years.
A fifth option is to sell the property through an independent administration of estates act (IAEA). This is a special provision that allows you to sell the property without court supervision or confirmation, as long as you have permission from all the beneficiaries or heirs. You can then sell the property as if it were your own, using any of the methods mentioned above.
The advantage of this option is that you can save time and money by avoiding court involvement and having more flexibility in how you sell the property. The disadvantage is that you need to get consent from all the beneficiaries or heirs, which may not be easy or possible in some cases.
Here's a quick overview of how probate sales work in California, and what you need to know as a buyer or seller.
Confirmed probate sales are more complicated and time-consuming than regular sales. They require the following steps:
Confirmed probate sales involve more risk and uncertainty for both buyers and sellers. Buyers may lose out to a higher bidder at the court hearing, or face delays, and legal fees. Sellers may have to wait longer for the sale to close.
Non-confirmed probate sales are similar to regular sales, except that they still need to follow some rules and regulations set by the court. They require the following steps:
The executor of the estate files a petition with the court to obtain IAEA authority, which allows them to sell the property without court approval.
The executor hires an appraiser to determine the fair market value of the property within a year of the sale.
Non-confirmed probate sales are faster and easier than confirmed probate sales. They offer more flexibility and control for both buyers and sellers. Buyers can make offers with fewer restrictions and contingencies. Sellers can sell their property at a higher price and close sooner.
We hope this post has given you some insight into how probate sales work in California and what options you have to sell a loved one's property. If you have any questions or need any help, feel free to contact us anytime. We are here to help you through this difficult time and make the process as smooth and stress-free as possible.
Thanks for reading and stay tuned for more blog posts on probate and real estate topics!
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