Selling Your House After a Bereavement
Probate, valuations, deeds and titles, multiple executors ...
Let's use a common yet unfortunate scenario ...
Your parents, or spouse has passed away, and now you’re left with the family home.
Perhaps you need to sell the home to pay for final expenses or you just want a fresh start.
You want to navigate through this process quickly so you can go on with your life and you should understand what to expect and how to get everything taken care of in the best way.
Let's begin ...
What is Probate?
When someone dies and no will has been written, you must apply for probate if you want to handle those assets, to disperse their assets, including their estate property.
If a will has been written then the Executor should apply for a Grant of Probate. The court then proves the validity of the will. An executor will then manage the estate and the distribution of the assets.
When it comes to the estate, it's generally sold so that the funds may be used to pay off creditors, including any existing mortgage, with any leftover proceeds being dispersed to the heirs. If the primary home is owned with a spouse as joint tenants, it will pass to them automatically with no need for a sale.
If the home is owned as tenants in common, it can pass to whomever is named in the will.It is also during probate that someone may contest the will. If a person does not have a will, the estate will still go through probate, but it will also appoint someone as administrator, which is generally the closest living relative.
Expert Tip: Consider the time-frames if you plan to deal with probate yourself, it can take up about 70 hours and over a year to get everything in order. If you don't have this time consider using a cash house buyer , they have their own solicitors so they'll handle it all for you.
If you're the executor of the estate, you may need to apply for the grant of representation, which enables you to manage the property.
You gain access to bank accounts and have the ability to sell property via an executors account and pay any debts. You're bound by any stipulations in the will, such as who will inherit specific items.
You'll also be responsible for paying taxes on the estate.
When to list the property
Homes can sit on the market for weeks or even months before they sell.
Don't believe us?
This timeline can delay the completion of probate and the disbursement of assets for a long time.
For some, they'll be in a hurry to get the property listed with an estate agent so that buyers can begin to see it. If you're lucky they may be able to get an offer in quickly.
You're most likely to see this happen if you’re going into the busy housing season or about to enter the slow-down period. You can select an estate agent at any point to have them value your property. They can show the home to buyers and even accept offers.
However, you cannot accept the offer and create a contract until after the grant of probate has been accepted.
You'll also have to remove all personal items and belongings from the home before the sale can be completed, this can be done through a house clearance service. Depending on how long the deceased lived in the home and how many assets they had, this can take several weeks if done by yourself or under a day if completed by a professional.
Expert tip: If you want to get a head start on the process, make sure buyers are aware of the extended timeline!
Pricing is another issue for a house in probate. If you list the house immediately based on the current market, the value may change by the time you receive the grant.
You don’t want to over or under price your home because of outdated market information.
For these reasons, it might be better to wait until the home is ready to be sold before you put it on the market. This way, it can be treated as any other home for sale with buyers.
Getting the house ready
Getting the home ready to sell is a complicated, time-consuming, often emotional task for families.
It can be made even more difficult if you don’t live close to the property.
You'll have to plan for days when you can take off work and spend going through the house, sorting items to sell or to keep.
Your first order of business will be to remove all personal items and most of the furniture. Without the use of a house clearance service, this could take several weeks, depending on how much time you have to dedicate to the project.
What you should do:
Set up three boxes and label them: to keep, to throw away, and to sell or give away
Organise everything in piles. Working on one room at a time
Set a date for a sale at the property or a nearby location. Then you don’t have to move everything
What you shouldn’t do:
Pack up everything to take to your home. You’ll just have more work to do later on
Try to do it all yourself. Ask for help from family or friends
Try to figure out pricing on everything. Hire an appraiser who can determine the value of items
Make Necessary Repairs
Many times, a home where the owner is deceased may be in need of repair.
If they were elderly or sick for some time, they may not have been able to maintain the house the way it should have been. It might be worth your effort to take a couple of hours to do some of these repairs. Even something as simple as fixing the guttering can make the world of difference.
If the repairs are more extensive, you can talk to an estate agent to determine how much the value would increase with the repair work done.
You can then make the decision whether you will sell it as-is or take the time to do the work.
Listing the Home
You have the option of selling the home yourself to a private seller, via auction, to a cash home buyer or hiring an estate agent.
Even though you will likely have a price in mind that you want for the home, you should be open to other options.
What are the other options?
For instance, you might find a cash buyer who'd be willing to pay a reasonable price, even though it might be a little lower than what buyers with financing will pay.
The benefit of working with a cash home buyer is a quick sale. They won’t have to get approved for financing, so you can close much faster. In fact, you can often close the contract in less than 7 days!
If you live in another city, it could be difficult for you to arrange for buyers to view the property without an estate agent. If you want the property off your hands quickly a cash home buyer may be the best option as you can sell your house fast cutting out all the stress and hassle of probate.
Another bonus ...
Choosing a property cash buyer means they will be less concerned about updates and your home being in perfect condition. They'll want to save money and possibly do the work themselves. At the same time, it saves you on the time and expense of making improvements for a house that may be severely outdated.
When there's more than one executor
In many cases, the estate may have more than one executor or administrator.
Both of you will have to agree on all decisions, such as sale price and the agent you hire. It’s helpful if you can set out expectations early in the process so you won’t be hindered by disagreements once the house is on the market.
Once the house has sold, you can put the money into the estate for disbursement either to creditors or to the heirs. You can divide the proceeds as the will stipulates or as the court decides. Be prepared to pay Inheritance Tax or Capital Gains Tax on the property, depending on how much you receive from the sale.
Expert Tip: As of October 2017, the Inheritance tax is 40% above the threshold of £325,000 of the value of your estate. If giving away the home to your children the threshold increases to £425,000.
You may have to pay the tax sooner than you expect, which is another reason to consider private house sales via a cash home buyer to move the process along faster.
It can be quick and easy
Selling a home after the death of a loved one is never easy, especially with so many emotions involved.
Property estate transactions are complicated, and often made even more so when the property must go through probate. You need to understand how probate works, your role in the deceased’s estate and how to get a home sold after the person’s death.
It's best to work with homebuyers who have all the processes of selling a deceased persons house already put in place, saving you even more stress as well as time.
They keep up with the latest laws and requirements for selling a home through probate.
It also frees you up to deal with other responsibilities that come from the death of a loved one. Just make sure you stay informed so you are aware of any potential problems or delays.
Once the home is sold, you can move forward with your life and being healing from your loss.