Selling the home of a person that dies is not particularly difficult but it does depend on the action (or inaction) taken by the person owning the home before death. Of course, you have to have the right to sell your inherited home fast for cash before you can sell it. This depends on how you inherited it. You can inherit a home through any number of means. Some require probate to sell the home and some do not.
Selling the Home of the Deceased When Probate is Not Required
Generally, these five methods depend on how the title to the property was previously recorded or specific state laws. If one of these five conditions exists, you likely only need a certified copy of the death certificate to sell the house in the traditional manner or in any way that is legal in your state.
Joint tenancy. When the home is titled this way, the surviving owner records an Affidavit of Death of Joint Tenant with the county records office to clear title to the property. Although joint tenancy automatically transfers full title to the surviving joint tenant, filing an affidavit with the deceased spouse’s death certificate establishes the facts necessary to document that the surviving spouse owns the entire house and can sell it alone.
Community property with right of survivorship applies in many states. The same as with joint tenancy, it allows the title to pass automatically upon the death of the first spouse to the surviving spouse. Again, it needs to be recorded with the county records office to clear the title to the property and will be on a different form. In other states (not community property), the surviving spouse has a claim to at least partial ownership of the house but has to split the inheritance with the deceased’s children and other family members.
Rights of survivorship. This is a way to title the ownership with an equal share of the entire property. When the first co-owner dies, their share transfers to the other co-owner with minimal paperwork. In some states, it only requires filing a certified death certificate but other states require additional paperwork.
Tenancy by the entirety works the same way as rights of survivorship, but this type of deed can only be used between spouses.
Transfer-on-death deeds. These are used in some states. You have to be named on the deed as the beneficiary although you have no rights or responsibility for the property until the owner dies.
Clearly, you need to understand which of these apply in your state. However, none should require probate and you will be able to sell the property using a certified copy of the death certificate. These should work even if an executor of the will has control over other probate assets. However, there could be tax reasons influencing when you want to sell such as a limited time to avoid capital tax gains by filing a joint income tax return. There also may be a requirement the home cannot be sold until all of the deceased’s debts are settled.
Common Probate Scenarios for Selling the Home of the Deceased
These scenarios do not have a definite timeline because the court is involved with the probate and there is not an automatic transfer of title to the home.
General probate process. The court first assigns an executor or administrator of the probate process (named in a will, closest relative, or attorney). The probate process must be completed. This can include the sale of the house through probate so that the proceeds can be distributed to all beneficiaries.
You become owner through probate. In this scenario, the probate process is followed but you become the owner of the home instead of it being sold to distribute the money. Once you become the owner, you can sell at any time. However, you might not be able to sell until the deceased’s outstanding debts have been settled.
Title is held in trust. This does not require probate but the trust is administered by a trustee. The trustee can either transfer title to you or sell the home to distribute the money.
The probate process can take a few short months or drag on for years. The time an executor has to sell a house varies from state to state. Some states have a limit of one to three years. While other states have no limit. Often it is a matter of how quickly multiple heirs agree on how to distribute the estate. One scenario that complicates it is when one heir wants to continue owning the home and another wants to sell.
All of the above is only intended as general information. None of it is legal advice. You need to seek the advice of a competent attorney before making any decision or taking any action.
What thoughts and experiences can you offer about selling a house after someone dies? Please share by leaving a comment.
Also, our weekly Ask Brian column welcomes questions from readers of all experience levels with residential real estate. Please email your questions, inquiries, or article ideas to [email protected].
Brian Kline has been investing in real estate for more than 30 years and writing about real estate investing for seven years with articles listed on Yahoo Finance, Benzinga, and uRBN. Brian is a regular contributor at Realty Biz News
