If you’ve been exploring various types of real estate opportunities, you’ve likely come across the concept of probate real estate. But what is probate real estate exactly, and why is it an appealing real estate niche for investors? Read on to find out why incorporating probate estates into your real estate strategy could be potentially fruitful.
What Is Probate?
In a nutshell, probate is the legal process through which a deceased person’s assets are distributed. Probate courts are in place to make sure that a person’s will is authentic and that their final wishes are executed appropriately. In cases where there is no will, the court is responsible for assigning legal ownership of the estate to a close relative.
What Is The Probate Estate Process?
To truly unlock the potential of probate real estate and communicate effectively with the sellers of probate properties, it’s important to fully understand the probate process. It can be stressful and overwhelming for grieving family members to navigate probate, and anyone pursuing probate real estate should be cognizant of that. Although there is variation in the process from state to state, probate properties will usually go through the following four steps:
1. Executor Assignment
The first thing a probate court does is assign an executor, or administrator of the estate. This is the person either designated in the will or assigned by the court to maintain and distribute all of the deceased person’s assets.
2. Appraisal
If the executor decides to sell the property, they will first need to have an official value assigned to it as part of the estate inventory that must be submitted to the court. The list price is determined after an official appraisal.
3. Listing
Once the courts clear the property for sale, probate real estate is then listed on the market just like any other property. Real estate agents that work with probate properties conduct business as usual to try and attract a high offer.
4. Approval & Sale
Once there is a viable offer on the table, and terms are agreed upon by the buyer and the seller, then an official notice is sent to the heirs of the estate. If no one objects to the probate sale within 15 days, then a court date is set to officially execute it.
What Is Appealing About Probate Real Estate?
Probate real estate may be a very specific market niche, but it is ripe with opportunity for the diligent investor. You will often find that inherited properties going through probate are more of a burden to beneficiaries than an asset, especially if they live far away and there are no plans to occupy the deceased’s home. This means that heirs are motivated sellers who are looking to settle the affairs of their departed loved one as quickly as possible. If you are willing to be patient and educate yourself thoroughly on probate properties, then you will have access to incredible deals on all types of real estate. If you’d like to learn more about the best way to approach probate real estate, you can find expert resources from US Probate Leads here.