Ward takes the stairs.

InnoVest Resource Management's

Foreclosure Forum

Home

Discussion Board

"Hands-On" Training

Title Holding Trust

Annual Reunion

Speaking Schedule

Store

Foreclosure Fundamentals

Code References

Recent Legislation

50 State Foreclosure Basics

Foreclosure Glossary

Foreclosure Statistics

75+ Yrs Interest Rates

Fillable Forms

Archived Articles

Dingbat Retirement Plan

Links

Booklist

Contact / Map | Priceline Tips

About Us

Home

 

Innovest Resource Management BBB Business Review

Article of the Month for February 2009 Printer friendly version

Oh, Dread...Fred's Dead

by Rick Harmon ("Rick, the Probate Guy")
Guest Author

Most every real estate investor will eventually come across a property they wish to purchase only to discover that the owner is deceased. Here’s a quick primer on what you need to know should you discover a property that is subject to an active probate proceeding.

Unless you already have more information about the probate case, begin by checking the chain of title to determine who the owner of record is, and exactly how title is vested. Unless title is either vested in the name of a trust with an identifiable successor trustee, or as a joint tenant with other (living) survivor(s), probate is almost impossible to avoid.

If you believe they are, in fact deceased, determine if an active probate has been filed in the county of their last residence (frequently the same as the subject property). Most all probate estates are filed in Superior Court; and some of these courts have at least limited or sometimes full access to the file, depending on your county. Los Angeles County has very limited information online and access requires knowledge of the case number. It may be necessary for you to make a trip to the court and physically inspect the original file.

The main thing that you want to determine is: Who has the capacity and power to sell you this property? The answer is the personal representative.

In California, estates having a date-of-death value of $20,000 to $99,999 may be able to use the Summary Probate proceeding which only requires a single court appearance (a.k.a. “mini-probate”). Once completed, the personal rep. receives an Order Determining Succession of Real Property and that’s what the title company will need in addition to a transfer deed when selling property.

A decedent’s estate whose gross total assets at time of death were over $100,000 requires a full probate, with appointment of a personal representative and restrictions to their powers to sell real property. The personal representative gets appointed by filing a Petition for Probate and receives an Order for Probate appointing them. They may be called Executor (if they’re named in the decedent’s will) or Administrator, if they are not named in the will, or if there is no will (called “intestate”). Another, generally temporary title is called a Special Administrator, who is typically appointed to take some extraordinary action due to a matter that requires urgent attention, like stopping foreclosure.

Once appointed, a second document is required to establish what specific powers the personal rep receives called Letters Testamentary (with will) or Letters of Administration. Review this document to determine if your personal rep has Full IAEA Authority or Limited Authority. Full Authority permits the sale of real property without going to court, requiring only the noticing of heirs or beneficiaries and a 15 day opportunity for them to object. On the other hand, Limited Authority requires a full petition for Order to Confirm Sale and is subject to certain rules and guidelines for sale of real property. The latter process will typically take from six to eight weeks to complete, and subjects the sale to over-bidding by other interested buyers. Not an easy process to control for bargain purchases.

However, to make this process simplest for you, remember that primarily you want to know who is in control of the sale, and their powers. The document that supports their capacity and powers is called “Letters.” So, no Letters, no powers, and no powers mean “no deal.”

Information provided by this website is for informational purposes only and is not a substitute for professional advice. Please consult your investment advisor and/or attorney before entering into any transaction. Read our privacy policy.

Copyright © 1997-2017, InnoVest Resource Management
http://www.foreclosureforum.com

InnoVest Resource Management, 4569-A Mission Gorge Place, San Diego CA 92120-4112
(619) 283-5444, Fax (619) 283-5455