Probate Properties

What is a Probate?

Probate is the legal process of proving the written will or last testament of a deceased person is genuine and then following the deceased's wishes in that document.

When assets of the deceased, such as a house, stocks and bonds, a car, bank accounts, and other personal property, are probated, the local probate court procedure gives creditors several months to file their unpaid claims against the deceased's estate. The unpaid bills will be paid once the property is sold.

Investing in Probate Properties

Investing in probate properties takes a lot of time and patience. Some probates can be completed within 6 months, while others take years.

The amount of time to complete the probate depends on a number of factors, such as the size of the estate, validation of the will, the appointing of an executor if there’s no will, and finding and notifying all beneficiaries.

How to find Probate Properties

Probate properties are often difficult to find. When looking for a probate property, the first person you should talk to is your real estate agent. Let your real estate agent know how much you want to spend and the types of properties you are looking for. Single resident homes, and multi-unit dwellings are just two of the many types of probate properties.

When looking for probate properties, you might want to check your local newspaper for obituary notices. Make a list of the recently deceased and check with local property ownership records to learn if the deceased owned local real estate. This task is often tedious and may be unfruitful. It is best to let your real estate agent find probate properties for you.

Wills in probate are a matter of public record. A little research at your local courthouse might get you a list of all wills presented for probate.

Benefits of Buying Probate Properties

1. Bargain Prices Many probate properties are often sold for 30 to 40% below market value.
2. Huge Inventory
3. Buyer's Market Many heirs really don't want the property they inherited and they just want to quickly turn the real estate into cash, even if at a below-market price. Many heirs also do not want the additional burden associated with the new property. They often do not want to pay estate taxes, make repairs, pay the mortgage.

Tips on Buying Probate Properties

• Have patience (it may take 2 to 3 years to complete the probate process).
• Know how much money you want to spend.
• Know the type of probate property you are willing to buy.

Finance Topic of the Month: Facts About VA Loans