Probate refers to what happens to a person’s assets, or their Estate, which includes Real Estate, after that person passes away. In probate, the Court confirms that another individual has the right to deal with the deceased’s Estate. Generally speaking, though there are exceptions, a transfer of Title to a property may not take place until this has occurred. When an owner has passed away, you should therefore consider whether probate must take place before the property is listed, sold or finally closed.
When dealing with a property on which one of the registered owners has passed away it is important to determine if the person’s Estate will have to be probated before the property can be dealt with or a sale of the property completed. Generally, if the owner of a property has passed away without a will the property should not be listed for sale or otherwise dealt with until probate is completed. This is because without a will it is not clear who would have the authority to deal with the property. If there is a Will, it may be possible to list a property and even complete an Agreement of Purchase and Sale because the Will lists executors who are authorized to deal with the property. However, a transfer of Title and final closing generally cannot take place until the Will is probated. So what must be remembered is that, whether or not there is a will, probate must generally take place before final closing. This will apply even if the individual who has passed away previously gave a Power of Attorney because a Power of Attorney will generally be of no effect after the person who granted it passes away.
If there are two or more Registered owners and only one has passed away, you should determine if the surviving owners can deal with the property without probate. If all of the owners held Title as Joint Tenants, then the interest of the owner that has passed away will automatically pass to the survivor (or survivors) and they can deal with the property without probate or the signature of the deceased owner. However, if title was held as Tenants in Common, the interest of the deceased person will not pass to the survivors. It will pass to his or her Estate and the Estate will generally have to be probated before final closing. This applies whether or not the deceased had a will. If you are not sure check the deed or ask a lawyer to do a subsearch for a copy of the deed. This will help you determine whether the property may be listed or sold and whether the property will be subject to probate before final closing. You should also try and determine how long probate will take from the lawyer for the Estate. Make sure the purchaser knows that closing may have to be extended or, for the Estate, reserve the right to extend and include the appropriate clauses in the offer.