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California Probate Realestate: Tips For Buying Property From Heirs
California probate realestate is a highly guarded investment secret. Most investors are unaware of the potential profit that can be reaped from properties held in probate. Oftentimes, this type of real estate can be purchased significantly under market value because heirs do not have the time or resources to maintain the property.
Heirs who inherit California probate realestate are oftentimes eager to sell the property for less than it is worth. When heirs reside out of town or in another state it can cost them a considerable amount of money in travel expenses, legal fees and court costs associated with settling the estate. By selling real estate held in probate they can reduce their expenses and use the proceeds to clear outstanding debts.
When a person dies without transferring their assets to a revocable living trust, their assets are transferred to Probate. This process is required to assess the decedent's assets and can tie up the estate for several months, or even years. In order to settle the estate all creditor and tax debts must be settled before assets can be distributed to heirs.
Depending on the circumstances, selling probate realestate might be the only way heirs can afford to pay debts associated with the estate. In other instances, heirs desire to sell probate realestate so they are no longer burdened with maintenance and other expenses associated with the property.
California probate realestate can be purchased directly from the estate executor. When multiple heirs are entitled to the property, they must all be in agreement prior to commencing the sale. Generally, heirs must obtain permission from the probate court in order to sell the property. Once permission is granted the court will oversee the sale and may require the heirs to sell the property through a licensed realtor.
Heirs have two options for selling probate realestate in the state of California. The property can either be sold through the Court Confirmation process or by using the Independent Administration of Estate's Act. When the estate is managed by a probate attorney, the property is usually sold through the Court Confirmation process so the sale will be supervised through the court system.
Purchasing California probate realestate is a relatively simple process. Wills in probate are public record and information regarding the estate can be located in local courthouses. It requires a bit of legwork and investigative skills, but court clerks can guide you in the right direction.
Once you locate probate realestate of interest, you can contact the estate executor by mail or phone. However, this is a delicate matter and contacting the executor should be conducted with the utmost respect.
When contacting heirs regarding the purchase of inherited property, express your condolences and explain you are offering a solution they may not know existed. Remember, the individual is grieving the loss of a loved one, so do not insult them by offering a low-ball price for their property. Instead, ask them what they feel would be a fair price. Oftentimes, heirs will accept an offer of 20- to 30-percent under market value. Allow them to tell you the amount they feel is fair before making an offer. Once you agree on a price, be prepared to expedite the transaction in a timely fashion.
Investing in probate realestate can be a profitable venture. However, it is wise to fully understand the process involved. If you are interested in buying or selling probate real estate, seek out probate specialists or private real estate investors who can walk you through the process.
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