Losing a loved one is difficult enough. Having to then negotiate the sale of the deceased estate property can feel overwhelming. Grief must be set aside for business matters, often when we’re least emotionally prepared for such huge decisions. It also gets tricky when dealing with multiple family members who have history and deal with grief differently. That’s why partnering with an experienced real estate agent can make all the difference in the world. In today’s post, we’ll guide you through the sometimes tricky rules and regulations around estate sales, and give you real-life examples we’ve experienced.
First, What is Estate Property?
People generally mean a home when they refer to estate property, although as a legal term it actually encompasses everything of value owned by an individual. In this instance, however, we’re focusing only on the home, rather than personal assets like insurance, art collections, investments, and so on. Legal assessments of these properties are actually very similar to those done in bankruptcy. Inherited homes are judged by real estate professionals based on fair-market value for the property at the date of the owner’s death. The difference is that an estate is assessed to determine which debts can reasonably be paid for those who have been declared bankrupt.
What is the Process for Selling an Estate?
Estate planning streamlines this process, since a drawn-up will explains the owner’s intentions for the distribution of their estate after they die. Either way, in Louisiana a court-appointed executor will navigate the property through succession, formally transferring ownership and re-titling the property in your name. As a cleared beneficiary, you can then move forward with liquidation of an asset such as your relative’s home. If the deceased’s intentions are unclear at the time of death, however, legally transferring property to a living beneficiary might mean a trip back to court. There have also been cases where, years after the original owner dies, heirs refuse to sell to other heirs out of spite but can’t afford to purchase themselves. Sometimes they can’t agree on a price. There are many examples we have as professionals who help navigate these murky waters.
What Mistakes Can be Avoided?
Start by collecting all needed paperwork – as early as possible. Sounds easy, right? But it all depends on whether or not your loved one died so suddenly that they hadn’t gathered these required documents. You’ll have to track down a copy of their will, home insurance policy, bill receipts, and bank and investment account documentation. If this can be done beforehand, it saves valuable time – and eliminates another stress point during what is already an incredibly difficult time.
"Remember that you will be responsible for taxes on proceeds from any deceased estate property."
Remember that you will be responsible for taxes on proceeds from this deceased estate property, so discuss costs with an experienced real estate professional and a CPA. Getting top dollar is usually a principal goal when selling your own home. But the tax implications with estate properties might make it smarter to set a price that’s in line with area comparables, or even just below them, in order to avoid an exorbitant capital-gains bill.
How Can Liz Wood Realty Help?
The grieving process can be made even more stressful if you’ve been named a beneficiary or executor for a deceased estate property, since it’s usually the most valuable item left behind. A recent client group had their mother donate the house to each of them far before her passing, so when she did pass away they didn’t have to go into succession. That was a very smart move for all of them, and overall made the sale of their mother’s home relatively pain-free. Don’t worry, though, we had our fair share of hurdles otherwise, but having the house in their names was not one of them.
Let the knowledgeable and compassionate agents at Liz Wood Realty handle everything from pricing to staging the home for sale, from setting the price to negotiating the sale. Contact us today to discuss how we can help.