Selling a Probate Property: What You Need to Know

Selling a home after the death of a loved one can be an emotional and complex process, especially if you’re the executor. Understanding the key steps involved in selling a probate property can help ease the process. Anthony Pepe, estate agents in Winchmore Hill and many neighbouring parts of London, have put together this comprehensive guide to help you through it.

What is Probate?

Before selling a home left to you in a will, you’ll need to obtain a legal document known as a “grant of probate.” This confirms your authority as an executor to handle the estate, including the sale of any property. The process of obtaining probate can take around 12 weeks or more, but you can list the property for sale during this time. However, you won’t be able to complete the sale until probate is granted.

Can You Sell a House Before Probate is Granted?

You can list a property for sale before receiving probate, but you won’t be able to finalize the sale until the document is granted. Since it may take around 12 weeks to obtain probate, it’s wise to allow a realistic timeframe of three to six months to complete the sale. Be sure to inform potential buyers and estate agents about this timeline to manage expectations.

Inheritance Tax: What You Need to Know

If the estate's total value exceeds £325,000, inheritance tax (IHT) may be payable. This tax is set at 40% on anything above the £325,000 threshold. The IHT bill must be paid within six months of the death, which can add pressure if the sale of the property is delayed. If the estate lacks sufficient liquid assets, you may need to arrange for funds to cover the tax. In some cases, you might have to use personal funds temporarily, which can be reclaimed once the property is sold.

What is the Role of an Executor?

As the executor named in the will, it’s your responsibility to manage the deceased person’s estate. This includes valuing the estate, settling debts, paying inheritance tax, and distributing assets to the beneficiaries according to the will. If the will requires you to sell the property, you’ll need to organise the sale, ensure it’s done at market value, and manage the funds from the sale.

Steps to Selling a Probate Property

Here are the main steps involved in selling a probate property:

1. Apply for Probate Probate is essential before completing the sale of the home. The process costs between £155 and £273, depending on whether you apply directly or use professional help. Once probate is granted, you’ll have the legal authority to finalize the sale.
2. Get a Property Valuation Obtain valuations from at least three local estate agents to ensure you have an accurate market value for the home. The value should reflect the home’s market rate as of the date the previous owner died, which will be used to calculate any inheritance tax due.
3. Check the Title and Deeds Before proceeding with the sale, have a solicitor check the property’s title and deeds. There could be issues, such as a co-owner you weren’t aware of, or restrictions that need to be cleared before selling. It’s crucial to address these early to avoid complications later.
4. Clear the House The house will need to be cleared of furniture and personal belongings before the sale. This can be an emotional task, so leave yourself enough time to go through everything carefully. Professional house clearance services or charity organisations can assist with larger items if needed.
5. Ensure the Home is Insured It’s essential to update the home insurance policy, as most insurers won’t cover a property under the name of someone who has passed away. If the house is unoccupied for more than 30 days, you may need to pay more to maintain insurance coverage.
6. Handle Costs and Maintenance While preparing the house for sale, you’ll need to maintain it. Keeping it heated during colder months can prevent dampness, and hiring a gardener or cleaner might help maintain kerb appeal. Any necessary repairs or improvements can also be made using funds from the estate.

Selling Before the Executor’s Year

As an executor, you have up to 12 months, known as the “Executor’s Year,” to settle the estate. During this time, it's common for property sales to be completed, but the inheritance tax is due within six months. If you can’t sell the property within this timeframe, you may need to pay the IHT out of pocket or arrange a payment plan with HMRC.

What if Beneficiaries Don’t Agree to the Sale?

The executor has the legal authority to sell the property without approval from beneficiaries, but it’s wise to communicate with them and involve them in the decision-making process. Beneficiaries can challenge the sale if they believe the property was sold below market value, so transparency is key. Ultimately, it is your duty as the executor to get the best possible price for the home.

Can a Probate Home be Easier to Sell?

Many buyers are familiar with probate sales and may find them attractive, especially if the property is chain-free or offers renovation potential. Pricing the home competitively can also help it sell faster, and buyers may be keen to purchase a property that has no onward chain.

Conclusion

Selling a probate property can seem daunting, but by following the right steps, you can navigate the process smoothly. As an executor, it’s crucial to stay organised, communicate with beneficiaries, and ensure all legal and tax obligations are met. With patience and careful planning, you’ll be able to complete the sale and settle the estate successfully.

Anthony Pepe – Estate Agent in Winchmore Hill

Whether you want a property for rent in Winchmore Hill, have a house for let in Cockfosters, or are interested in residential home sales in Haringey, Anthony Pepe are ideal estate agents to contact. You can reach us by clicking here and filling in the online form.