Real property is a common estate asset. If you are the next of kin or proposed executor or administrator of a loved one’s estate, you may be charged with selling a parcel of real property. This article will give an overview of the process and propose a couple of ways to expedite it in order to save the estate time and money.
It is not uncommon for beneficiaries of an estate to want a speedy sale of the real property. There are many reasons for this desire. Beneficiaries may want their money quickly or they may not want to continue paying maintenance, insurance, taxes, and utilities on the property. If the property was being rented, they may not want to deal with tenants. Furthermore, they may wish to avoid the liability that comes with owning real property, a co-op, or a condominium.
Selling As Heirs-At-Law
In some circumstances, if the decedent did not leave a will and all of the next of kin (known as distributees) consent, real property can be sold through affidavits of heirship without having to go through a court process. This method obviates the need for a filing in Surrogate’s court since, in New York, real property automatically vests in the distributees upon the death of the decedent. Despite this, not all buyers feel comfortable with affidavits of heirship and they, or their title companies, will require letters of administration.
Selling as Executor or Administrator
If the sale can not be done through an affidavit of heirship, a necessary step in getting an estate property sold is to have someone appointed by the court with the authority to sell the real property or co-op. If there is a will, that person is called the executor. If there is no will, they are called the administrator. Unfortunately, in many counties in New York, the appointment of such a fiduciary can take several months, even without complications. An experienced probate attorney can assist you in this process and help you avoid costly mistakes and delays.
Expediting the Sale
In some situations, you should not begin the sales process until you are formally appointed. In other cases, you can begin the process of marketing the property before being appointed by courts, so that when you receive your formal appointment, you can sell as quickly as possible. For those looking to be ready to sell as soon as the fiduciary is appointed, they should begin by establishing a relationship with a real estate broker who can market the property. Since this option is not available to all estates, always consult with your estate attorney before engaging a broker or entering into any agreements.
Preparing for the Sale
After you have entered into a contract of sale, but before closing, you will need to make sure that title to the property is clear. The buyer will hire a title company to make sure that there are no violations or liens against the property. If you wish to expedite the sale, don’t wait for any potential issues to be brought to your attention by the title company. You should conduct your own due diligence and seek to remedy any building violations, remove any liens against the property and evict any current tenants (you should note that evictions can take several months) well before the buyer’s title company issues their report. This can help to prevent closing delays.
After the Sale
After you have closed on the sale, you will still need to finalize the estate before issuing any checks to the estate’s beneficiaries. You will need to pay outstanding expenses, reimburse those expenses laid out by others, and file outstanding tax returns. If beneficiaries are anxious to receive their portion of the sales proceeds, it is possible to issue checks at closing as long as a final accounting has been prepared and signed off on by all parties. Most often, however, the buyer makes the sales proceeds payable to the estate which the fiduciary will place into an estate account and hold onto until the estate has been completely settled. It is always best to consult with your probate attorney before issuing any payments from the estate account.
The Law Offices of Roman Aminov is an award winning probate attorney in New York City. Call us now at 347-766-2685 to discuss your options and prepare for legal needs.
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