A Guide To Selling A Probate Property Sunday, June 10, 2018
Selling a property in probate is more complicated than a normal sale and technically you are unable to do so until you have obtained a Grant of Probate (or Letters of Administration where there is no Will) - however, there are steps you can take to speed up the sale process whilst you're waiting for the Grant of Probate.
It will take a minimum of around 8 weeks to obtain a Grant of Probate, and much longer if inheritance tax is due to be paid on the estate. If there is a property in an estate that you are dealing with, there are many reasons why you might want to sell quickly but be aware that completion will be delayed if you find a buyer before probate comes through.
Can You Sell Before Probate Is Granted?
If the property is held in the sole name of the person who has died, you cannot sell the property before the Grant of Probate is issued. However you can decide to put the house on the market during this time, and if someone makes an offer, completion can only take place once probate is granted.
What Happens If You Sell A Probate Property?
The conveyancing fees for selling a probate property should be the same as selling a standard property, although the process is different. However you need to be prepared for the additional costs of obtaining the Grant of Probate during the process.
As a guide, selling a probate property may mean you need to:
- Calculate the value of the estate in order to apply for
This information may be available already, or you'll need to request information on the deceased's assets and liabilities through gathering bank statements, mortgage details, pension details, as well as information such as utility bills and funeral costs.
- Have the property valued
To ensure the inheritance tax is calculated correctly, it's a good idea to have three separate valuations carried out on the property before putting it on the market.
- Make it clear to the buyer
Unless you already have a Grant of Probate, the additional time involved in obtaining the grant must be made clear to any potential buyer and the buyer's solicitors
- Pay ongoing maintenance costs
It is very important that you ensure that the property remains insured up until completion of the sale, and you will need to pay insurance to cover this. There may also be other ongoing costs such as heating the property in winter months to prevent damp, and unless you're happy to do it yourself, you will need to pay to have the house cleared before you sell it.
- Renovate or not
Depending on the state of the property, you may decide to renovate before selling it. Alternatively, you may prefer to sell it at a slightly lower price and save on the renovation costs. We always recommend that you follow the advice of your estate agent before deciding whether or not to carry out any such work.
What about Inheritance Tax?
If Inheritance tax is payable, it is calculated on the value of the whole estate plus certain lifetime gifts and transfers. Although payment of most of any tax payable in respect of the value of any land and buildings can be delayed, the portion of any tax payable in respect of the rest of the estate must be paid up front, before the Grant of Probate can be applied for. If you sell the property for more than the probate estimate in your tax return, you'll need to provide evidence explaining why - and may have to pay more tax, unless you can show that the increased value relates to the cost of renovations you have carried out. If the property sells within 4 years of the deceased's death for less than the valuations then you may be entitled to a tax rebate.
The Importance of using a Conveyancer with Probate Experience
If you're selling a property through probate, it can be legally tricky - and it's important you use a professional, experienced conveyancer to guide you through the process and ensure the best possible outcome.
All our conveyancers have helped individuals sell probate property and fully understand the complexities of this process, including valuations, paperwork needed, and negotiations with potential buyers on completion dates. We can also help with obtaining the Grant of Probate and will be able to provide legal guidance on every aspect of your house sale.
For impartial advice and guidance on selling your probate property, please contact our specialist probate conveyancing solicitors at our Chorlton office on 0161 860 7123 or at our Failsworth office on 0161 681 4005 or email firstname.lastname@example.org