The probate process is lengthy and tedious. So selling a home in probate can add an extra layer of complexity to an already terrible process. But in some cases and, in some states, you do not need court approval to sell a home in probate.
If a probate court gives the personal representative (the executor or administrator) power to administer the estate informally, and if the Will DOES NOT prohibit the sale of a home, then a home may be sold in probate without court confirmation or supervision.
In all other cases, a personal representative may NOT sell a home in probate unless the court explicitly allows the sale.
But, just because a court grants power to manage an estate informally or independent of court supervision, does NOT mean that the executor or administrator can do whatever they want.
The information in this article will help guide you from beginning to end.
As a preface to this article, you need to know about the Uniform Probate Code. The Uniform Probate Code is a uniform probate law adopted by nineteen States to standardize the probate process.[i] The other States have adopted portions of the Uniform Probate Code, or (like my home state of California) have created their own unique system.
The authority for this article comes from the Uniform Probate Code. So if you live in Alaska, Arizona, Colorado, Flordia, Hawaii, Idaho, Maine, Massachusetts, Michigan, Minnesota, Montana, Nebraska, New Jersey, New Mexico, North Dakota, Pennsylvania, South Carolina, South Dakota, and Utah, then this information is accurate for your State.
If you live in some other state, then this information is still applicable, but you will need to check the specific procedures required in your particular State.
California is governed by the California Probate Code. If you live in California and want to know how to complete a probate sale without court confirmation, check out our article called “3 Ways to Sell a California Home in Probate Without Court Approval.”
How to Sell a Home in Probate Without Court Confirmation or Supervision Under the Uniform Probate Code
If you are in a Uniform Probate State (“UPC”), then there are two types of probate: formal and informal.
You can sell a home in probate without court confirmation or a notice of proposed action, only if the court allows an informal probate and gives you informal probate powers.
Generally, UPC States encourage the estate’s representative to expeditiously settle a person’s estate without a court order or specific direction of the court.[ii] Thus, informal probate is the court’s preferred option.
But the court will require a formal probate if someone contests the Will or objects to your appointment personal representative.
If you are required to open a formal probate, then you must seek court approval to sell a home in probate.[iii]
Assuming that the court opens an informal probate and gives you informal probate powers, you have extensive powers to administer the estate without court supervision or approval.
As it relates to a house or condo or other real property, you have the same powers over title to real property as the absolute owner of the real estate.[iv] Thus, you have the authority to sell a home in probate “without notice, hearing, or order of court.”[v]
There are 26 separate powers given to a court-appointed personal representative allowing him or her to take any action regarding the probate estate.[vi] Relating to the sale of a home, the personal representative may:
- Ratify or reject contacts made by the deceased person
- Buy and sell assets and property
- Make repairs to property
- Subdivide, develop, and/or dedicate vacant land
- Enter into lease agreements
- Enter into lease agreements for extraction of natural resources
- Allocate funds to estate principal or income
- Hire employees, professionals, and independent contractors
- Sell or rent out a home or condo owned by the estate
- Satisfy and settle debts and distribute estate property
Once you have informal probate powers, you do not need to give notice to the heirs or seek court approval. But, there are specific steps you need to take that may not be obvious.
Steps to Take to Sell a Home in an Informal Probate
Here is a general breakdown of how to sell a home that is in probate using informal probate powers:
- 30-days after your appointment, send notice to the heirs of the estate and any other person named in the Will.
- Create an inventory of estate assets.
- Hire a qualified appraiser and have all the assets appraised as of the date of death.
- Send the heirs and any other interested person a copy of the inventory & appraisals.
- Read the Will. Even with informal probate powers, you CANNOT sell a home if the Will prohibits the sale.
- Get the home appraised.
- Send notice of your intention to sell the home to the heirs and other interested persons.
- If the Will prohibits a sale, try to get written consent from the heirs and all interested persons.
- Obtain certified copies of the order appointing you the personal representative.
- Hire a qualified real estate agent.
- Sell the home at or near the appraised value.
Now let’s looks at each of these steps in more detail.
1. Send notice to the heirs of the estate.
Within 30-day of your appointment as the personal representative (which is the same as an executor or administrator), you need to send notice of your selection to the heirs.[vii] In addition, if there is a Will, you need to send notice of your appointment to any other person named in the Will.
Your notice needs to include your name and address. It must tell the heirs and other persons that you are administering the estate without court supervision. Finally, it must also inform the heirs and other persons that they have a right to petition the court regarding any matter related to the estate.
Although not explicitly required, it is also a good idea to enclose a copy of the court order appointing you as personal representative.
If you fail to give this required notice, it is a breach of your duty to the heirs and other persons listed in the Will. But failure to provide this notice WILL NOT invalidate your appointment.
2. Create an Inventory.
Within 3-months after your appointment, you need to create an inventory of all of the assets subject to probate owned by the deceased at the time of their death.[viii] Your inventory needs to be filed with the court. It must be sufficiently detailed to the court knows what the asset is. For example, it is not enough to say “house” you need to provide the address, and should also provide the parcel number and legal description.
Finally, the inventory needs to identify the fair market value of the deceased person’s estate at the date of death.
3. Hire a qualified appraiser.
Although not required, unless you have specific skills in appraising probate estate assets, you should hire an appraiser or a team of appraisers (depending on your situation.) Some assets won’t need an appraisal. For example, a checking account or cash accounts are easy to appraise (you just look at the value at the date of death.)
But other assets in the probate estate can be harder to come to a fair market value. For example, real estate should only get appraised by a qualified real estate appraiser. It is not good enough to get a “zestimate” from zillow. Also, art or other collectibles may need a specialized appraiser.
This may seem like overkill, but particular items in the probate estate may have unexpected high value, and for tax purposes, you will want to know the exact value is because you do not want to run into any tax problems in the future.
The UPC gives you the authority to hire multiple appraisers; you just need to identify the appraisers by name and address on your inventory.[ix] But any appraiser you hire must be “disinterested.” That means that the appraiser cannot be related to you, and cannot be an heir or other beneficiary of the estate. It also means that the appraiser cannot be related to an heir or other beneficiary of the estate.
4. Send the inventory & appraisal to the court and heirs.
Once you have a complete list of the assets and their fair market value, file the inventory with the court and send the inventory and appraisal to the heirs and other persons listed in the Will.
Don’t worry if you discover additional property later. You can file a supplemental inventory & appraisal for the property you learned about after the initial inventory.[x]
5. Read the Will.
As a personal representative, one of your jobs is to administer the estate according to the terms of the Will. If the Will prohibits the sale of a home during probate, then you CANNOT in the sale of real property (even if you have informal probate powers).
Sometimes a Will will explicitly says: “my executor is not authorized to sell my home.” But often, it is not as clear.
For example, a Will may prohibit a sale if it contains language requiring that the executor give the home to a particular person or group of persons.
So if a Will says: “My home goes to my children,” or something similar, this could be a prohibition because it shows that the person who created the will intended that the home for to particular persons.
But if there is universal language, like “my estate goes to my children,” then this is not a prohibition because it does not express any intent that particular assets (like the home) go to specific people.
6. Get the home appraised.
After you have completed steps 1-4, you can start to sell the estate property. If you want to sell a home, you need to have the home appraised. You will already have an appraisal for the date of death. Although not required for sale, you should get the house reappraised to demonstrate that the sales price is fair to the beneficiaries.
7. Send notice of your intention to sell the home.
Send written notice to the heirs, persons identified in the Will, and any other interested person (like a creditor) notice of your intent to sell the property.
Your notice should identify the proposed date of the sale, the sales price, and the cost of the sale (closing costs, commissions, fees, etc.)
This gives you added protection just in case someone tries to object after the sale. It also puts the onus on the objector to file an objection.
8. If the Will prohibits a sale, try to get written consent.
If the language of the Will prohibits a sale, you may still be able to sell the home during probate if all of the heirs and interested persons consent. The UPC does not have a specific procedure authorizing a sale in these circumstances. So you will need to check your local rules in your State to see if this kind of sale is prohibited.
Generally, the risk of selling a home in probate when the Will prohibits a sale is a lawsuit from the heirs entitled to receive the asset. If those persons consent, then the risk is eliminated.
All States provide procedures for summary orders if all interested persons provide written consent.
Therefore, if a Will prohibits a sale, get the written consent of everyone who could possibly ever object to the sale (heirs, creditors, and other beneficiaries).
But depending on your local probate rules with respect to the probate sale process, you may still need to get court approval.
9. Obtain certified copies of the order appointing you the personal representative.
When you sell any real property, the escrow & title company is going to need to know that the person signing the sale papers is authorized to sell the property.
Thus, when you sell a home in probate, escrow and title need a certified copy of the order and “letters” appointing you as the personal representative.
You can get a certified copy of the order and letters by going to the court and requesting a certified copy.
The difference between a regular copy and a certified copy is that a certified copy has a special seal from the court, indicating that the copy is authentic. It costs a little bit extra, but it is necessary to complete the sale of the home.
10. Hire a qualified real estate agent.
A real estate agent or real estate broker is technically qualified to sell a home in probate. But, not all real estate agents have experience selling a home in probate. As discussed above, there are a few extra steps you need to take to complete the sale. So it helps to have a real estate agent familiar with the process. Numerous real estate agents specialize in sales of probate assets.
Additionally, some states put a limitation on commissions for agents selling probate assets. So I would hire a specialist who knows the particular rules in your State.
11. Sell the home at or near the appraised value.
This may seem like a no-brainer, but you would be surprised in how many cases I get on my desk where the person wants to sue a personal representative because he or she is trying to sell an estate asset. Usually, the dispute is not even about whether the representative should sell the property. Instead, the disagreement is about for how much the property is selling.
Additionally, some states have requirements that the sales price for a property in probate be within a minimum range of its appraised value.
Be Cautious of Pitfalls and Know Your Rights
If you are an heir or beneficiary and you do not want the personal representative to sell estate property, you have every right to petition the probate court to stop the sale or exercise supervision over the sale.
If you are the personal representative, you do not have unfettered authority to sell estate property. There are some limitations.
- You cannot sell or transfer estate property by any means that is void or voidable by creditors.[xi]This means you cannot fraudulently transfer property to get out of paying a debt. If you are a creditor, you can have the court void this type of sale.
- You cannot sell estate property to yourself, your spouse, your agent, your attorney, or your business. Any heir or beneficiary can ask the court to void this kind of sale.
If you do any of these things, you are personally liable for a breach of fiduciary duty.
It is possible to sell a home in probate without court confirmation or supervision. But just because you CAN do something does not mean you SHOULD do something. If you are the personal representative of an estate, you are a fiduciary to the heirs and beneficiaries. This means that they can sue you if you mess up. Therefore, it is often beneficial to have court supervision and approval of potentially objectionable actions. But it is certainly possible to sell a home in probate using the informal probate process.
[iii] Uniform Probate Code § 3-711 & 3-715.
[iv] Uniform Probate Code § 3-711.
[v] Uniform Probate Code § 3-711.
[vi] Uniform Probate Code § 3-715.
[vii] Uniform Probate Code § 3-705.
[viii] Uniform Probate Code § 3-706.
[ix] Unifrom Probate Code § 3-707.
[x] UPC § 3-708.
[xi] UPC § 3-710.