How Long Does an Executor Have to Sell a House?
And Everything Else You Need to Know About Probate Sales in Virginia
If you’ve been named an executor of an estate and have a house to sell, read on. The process is far more involved than simply calling a Realtor and putting the home on the market. We get a lot of questions on this topic, one of the most common being “How long does an executor have to sell a house?” Read on for this answer and more on selling a house in probate in Virginia.
First Things First
The first step is to figure out the specific role you are playing in settling the estate. There are three possible roles someone can play upon someone’s passing: trustee, executor, or administrator. If the deceased left a will, an executor is named. If they did not leave a will, an administrator is appointed. If the deceased person’s assets go into a trust, a trustee assumes these responsibilities
Note that if the home is in a trust, no further action is needed to sell it.
Executors must then go to the courthouse of the deceased person’s last residence to register the will with probate court. Probate is a court-supervised legal procedure in which beneficiaries legally obtain the financial and physical assets promised to them in a will. Probate also clears the debts of an estate. This official act is what registers the will and allows the executor to move towards the distribution of the estate proceeds. The probate clerk will advise on the next steps the executor should take. It’s important to note that if real estate is the only asset in the will, the executor does not need to go to probate court to register.
So how long does an executor have to sell a house?
While there is no deadline for filing probate in Virginia, it’s best to do so as soon as you’re ready, preferably within 30 days from death.
The longer you wait, the harder it becomes to gather all of the necessary paperwork. After this step, the executor is free to list the home. There is no deadline for selling a home in probate. However, sooner is better than later, as the process of distributing the proceeds can take months or even years.
Selling a House in Probate
A few other things to keep in mind:
- As executor, you should immediately contact the homeowner’s insurance company to inform it that the home is no longer owner-occupied. You’ll want to ensure the homeowner’s insurance policy remains in place while the home is on the market.
- Make sure that all the beneficiaries in the will are informed and in agreement with the sale of the home.
- The personal representative is exempt from seller disclosures. However, if the personal representative is aware of any issues with the home these should be disclosed to prospective buyers.
- While the process of listing a home in probate is the same, there are a few key differences to note. Probate sales usually receive lower offers than standard transactions due to the length of the process. Be sure to hire a Realtor with experience in probate sales! An experienced agent can make sure that the process doesn’t take even longer due to paperwork missteps.
Receiving the Proceeds from the Home Sale
If you, as executor, sell the deceased’s home within one year of his passing, the proceeds will be held until the one year mark by the underwriter. Why? Creditors have up to one year from the date of death to make a claim on the estate so the money is held in the event any claims do arise. The underwriter will allow the executor to use the proceeds for any of the deceased’s personal expenses, such as funeral costs. If the executor wants or needs the funds before the one year mark, she can receive them for a fee (two percent per $100K in sales price, so for example, $12,000 on a $600,000 home). This fee goes to the underwriters to cover the risk they are taking releasing the money early.
The Bottom Line
Being the executor of an estate is a big responsibility. There are many steps and procedures to follow, especially when there is property to sell. Be sure to register with probate court as soon as you’re ready and use a Realtor experienced in probate sales.
Again, this information only applies to probate sales in Virginia. Please contact us to learn more about the process in DC or Maryland.
If you’ve been named an executor of an estate and have a house to sell, please reach out. We’d be happy to put our expertise to work for you. Please understand though that we are not lawyers and cannot give legal advice. If you are seeking or in need of legal advice, please reach out to a lawyer.