Investing in probate properties is a great way to make money by purchasing inexpensive homes and selling them at a higher price without a lot of fixing up work. However, the process of buying or selling probate properties is unique and quite different from typical real estate processes, which can make it a little confusing for first-time investors. Before you run off to buy homes in probate, it is important to gather as much information and understand the process to find the best deal and enjoy a smoother process.
What Is Probate Real Estate?
Probate real estate is a legal process whereby the property of the deceased person that is not a part of a trust is either sold, or the ownership is transferred after the death of the original owner.
The property enters the court system, where the investors are identified for the purchase of the property in question. Any assets that are distributed under the will or all assets in case there is no will go through the probate process, which is often referred to as the administering of the deceased person’s will.
Why Probate Sales Are A Great Opportunity For Investors?
What makes it a great opportunity for investors is that most properties that go through the probate real estate process are sold at highly reduced rates as the new owners are usually motivated to sell quickly. Not everyone is happy about inheriting property through their deceased relative due to the costs that often coincide with the property. As a result, they’re willing to part with it quickly and at a greatly reduced asking price.
Probate Real Estate Process
Although the probate real estate process might seem confusing to some people, it typically involves four basic steps:
- The will usually mentions whether the heir will inherit the property or if it has to be sold. An executor for the estate is appointed in case there isn’t one mentioned in the will to begin the probate process. Without a will, probate proceedings can drag on for years and create a rift between family members as they fight over who gets the property which was the case when Aretha Franklin died in 2018.
- If the property needs to be sold, the executor will determine the asking price for the property by conducting an appraisal with the help of an experienced probate real estate agent.
- The third step is putting the property up for sale after the listing price has been determined. Working with a real estate agent experienced in probate sales can help attract higher offers as they know how to market the property in the best possible way.
- The final step is the approval and sale. Once the real estate agent receives an offer, they will negotiate the terms of sale to make sure they satisfy both the seller and the buyer. An official notice is issued to the heirs, and they have the right to object to the sale within 15 days. Once the offer is approved by all, the sale is officially executed by obtaining a court date.
Leading Probate Real Estate Agent in Los Angeles
If you have any more questions or concerns regarding buying and selling a probate property in Los Angeles, get in touch with the leading probate realtor, John Matukas from EXP Realty, today.