Probate

The following is provided as a courtesy to assist in understanding the benefits of home ownership only. The Shire Real Estate Group and its agents cannot and does not provide leagal advice. For legal information or questions you should obtain advice from a professional attorney. (An attorney list along with certified public accountants can be found on our webpage under local partners).

Probate is a Legal Process

The Objectives of Probate are:

  1. To establish the validity of a will or other non-testamentary depositions of property
  2. To establish the property identity - Heirs and Devises
  3. To protect the rights of creditors / To provide for the payment of taxes
  4. To preserve property during legal process
  5. To distribute property to appropriate parties

Title of the Probate (The Estate of Deceased):

  1. Title
  2. Legal Control
  3. Possession

Overbids:

If a person is interested in purchasing the property but did not have the bid that was returned to the court for confirmation, that person may appear at the hearing and make an overbid. Normally, overbids are offered at the hearing verbally. At the consummation of the confirmation hearing, the successful over-bidder will be required to execute the bid in writing. Some Probate Courts have forms satisfactory to fulfill the requirement that all bids must be in writing. In addition, the successful over-bidder will normally be required to submit a deposit of 10% of the overbid amount. The executor/administrator or the counsel will be required to be aty the confirmation hearing to accept such deposits. There is a statutory formula for the first overbid (Section 10311a). It is an additional amount equal to 10% or more, on the first $10,000 and 5% on the amount of the original bid in excess of $10,000.

Example:

Original bid returned for

= $100,000
Confirmation     = $1,000
First overbid must be = $4,500
10% of $10,000 = 105,500
5% of $90,000
TOTAL

Once such a minimum overbid has been made and received by the court, the court will ask for any further overbids. Normally, the judge will establish minimum increments as to additional bids. Any overbids are considered as to their gross amount without regard to any commission payable to an agent as a result of the sale being made to the over-bidder (Section 10311e Probate Code).

The Transaction:

The sale of a probate property is not like a normal residential sale. The transaction has stringent rules and regulations which the Listing Broker and their Agents must adhere to. Some examples of these rules and regulations are:
  • The amount of the earnest money deposit
  • The Buyer's deposit is non-refundable
  • Length of escrow time frames
  • No termite work
  • Limited disclosure from the Estate
  • Required disclosures required by the Estate's Real Estate Broker
  • Required disclosures required by the Buyer's Agent
  • Buyer's exposure to loss of their earnest money deposit, etc

When dealing with a Probate or a Trust, please feel free to give John a call with any questions you may have, John has over 25 years of experience dealing with Probates, Trusts, and will be happy to answer your questions over the phone if he can.

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