Need a Probate Expert
Rehabber · Beecher, IL · Member since 2013 · 101 posts · 21 votes
Hi everyone,
I am looking to expand a little more into probate. We had run across a couple, but they were referrals, not marketing. We currently do flips, some flips to lease option and buy mostly short sales or sheriff sales.
I am looking for someone that is an expert in Probate to getting that acquisition strategy up and running in my area.
Thanks,
Mike
Mike -
Like Bill Gulley said, just make the offer. The closing attorney will make sure there is clear title, everything is done and it's OK to close. The only thing I do differently is adjust the time frame for closing.
You might add some type of verbiage that says you will close in ____ days once the court/ or probate attorney says it's OK to close. That way you are not out of contract if the court comes back and says there will be a delay. Every now and then the executor thinks everything is done and in reality, it is not. You may have to wait 1-2 months or even more to get everything in order.
The bottom line is that this is a legal matter where an attorney needs to take care of things. You don't need to do anything differently than you do for another type of deal.
Sharon
Mike, probate is not rocket science, you can speak to a probate attorney and in 30 minutes you'll get the process of probate actions. The trick is identifying properties going to probate or headed to heirs by a Will or in trust. A good relationship with a probabte and estate planning attornies in your area can feed you leads to make an offer. Also contact Trustees as they eventually may dispose of RE as most trusts would prefer other liquid assets to manage, there are fair market values that must be used in trust accounting and RE can be a pain to manage, so they get rid of it and buy what they can manage, bonds! You can dig through the obits like others, but really, contacts with attorneys are the best source. You may get more deals if you suggest you're willing to partner, maybe with another attorney as a money guy. The trustee usually knows other attorneys willing to buy and/or contract a rehab...hint, hint, hint.... good luck! :)
Mike -
Like Bill Gulley said, just make the offer. The closing attorney will make sure there is clear title, everything is done and it's OK to close. The only thing I do differently is adjust the time frame for closing.
You might add some type of verbiage that says you will close in ____ days once the court/ or probate attorney says it's OK to close. That way you are not out of contract if the court comes back and says there will be a delay. Every now and then the executor thinks everything is done and in reality, it is not. You may have to wait 1-2 months or even more to get everything in order.
The bottom line is that this is a legal matter where an attorney needs to take care of things. You don't need to do anything differently than you do for another type of deal.
Sharon
I understand that theory behind it is very easy, but I do not even truly understand how the probate process works. I do not know how I would approach an attorney with confidence when I am unsure what his role even is in probate.
As far as just make an offer, I do not even know how to track down probate properties, yet besides going to an attorney that handles them, which again I wouldn't even know where to begin with them.
I am not concerned about clear title, the real estate side of things is like any other deal, but I am looking for help in getting these deals in the pipeline. That is why I am looking for a personal mentor, someone that can walk me through it step by step.
Mike Neubauer, Let me ask if you know the process of addding additives to concrete for obtaining different concentrations in meeting stress requirements? No, I'm guessing you don't, I don't know either, I just know there is a difference for different applications. All you or I do is order concrete for a driveway. To be in RE you'll never really need to know the formulas for concrete, it's done for you. Same with probate!
This is all you need to know:
http://en.wikipedia.org/wiki/Probate
If a person dies intestate they die without a Will and thier property goes through probate and property is distributed by law. Generally an Administrator is appointed by the court.
Each community at the county (or whatever) will have a Public Administrator either elected or appointed and propertys is distributed or sold through them. I failed to mention this above, it's an office you need to contact and ask how they dispose of RE. Generally it will be by a public sale much like foreclosures. In some areas, depending on state law, the Administrator may list the property for sale or take bids.
An Executor is a personal representative of one who dies with a Will. You may hear people say that if you have a Will you avoid probate, this is not really true as the probate court must approve the Will and if it is found to be valid the court approves the Executor appointed in the Will. At this point you may be dealing with an attorney or usually it will be just a friend or relative, an average Joe who was selected to settle ones affairs.
Either way, the probate court approve the sale, either the Administrator or the Executor asks for approval of the sale of real property unless the court has all ready granted the authority to sell. An Executor or Adminitrator Deed is given and the rights granted are insurable for title with warranties. At this point the title company insures title and the closing and you have only to ensure that title is covered and understand what might be excepted out as with any other sale.
I believe in all states the Administrator or Executor may be paid for thier services, compensation may require court approval. Fees to an Public Administrator are usually set by law, fees to an Executor may be nothing or what is deemed appropriate and inline with what is paid to an Administrator. So, it is not unethical to pay either for disposing of the property. Payments need to be disclosed to the courts and to the parties involved. In my county the Administrator charges 10%!
As an investor you just don't need to get involved with the probate process but allow the Executor or Administrator to take care of what they need to do, just stand back. When you have an average person acting to settle an estate that is where you might assist them to simply advise them (show them) values and costs of repairs and you simply negotiate a price as you would with anyone else. All you really need to do is be involved as a buyer as you normally would with anyone else. You just need to realize that heirs may need to agree and that such deals can drag out.
When you have heirs that may not agree to a price they can slow or stop a sale by going to court and stating thier case, eventually the court will rule. I do know of a few cases where one heir was paid to agree to speed things up, I believe this to be unethical personally but so is holding up a sale at fair market value under the cicumstances.
An investor who gets too involved in a probate matter certainly begins taking on liabilities that they should never be involved with unless they are an attorney!
As to your confidence, read the link and what has been and may be mentioned here and you will know more about probate sales than millions of people, more than most who may be appointed as an Executor!
Attorneys advertise in the yellow pages as to what areas of law they practice, just call them. They like you have a network they have dealt with before. For those who may not be initially receptive (understand too they may not have any property and have other things to do) just move on and stay in touch with them. If they are involved with a current estate to sell they will tell you thier proceedure (time to view or auction) the property and if title work has been done. Usually the work with a RE brokerage or auctioneer, they will get an estimated value the property will sell for. They may not be required to list or auction a property if they obtain a solid bid that yields a better price. IMO, this is about the only thing you need to stress to them, that you will be willing to pay more for some properties than what they may get from listing or auctioning a property.
The attorney will have thier procedure in thier office, each may be different, so you can always ask. If you stress that you are a cash buyer and can close quickly and convince them you're a serious buyer they should give you a shot. As I was hinting above, there are some who get a justification of value and they will call someone they know and do a deal. That other buyer may be another attorney or professional in RE. They are kicking some good deals off to another, that other may not be in the rehab business. Letting them know you might be willing to partner might be a plus as they can arrange for you to do your thing while still throwing business off to thier other party. This is the reality in some areas, like mine. Somehow, probate attorneys usually end up with RE portfolios. In such cases, don't fight them, join them, they usually contract for repairs, I've never seen a probate/estate attorney paint a house! Good luck, you can do this! :)
Hi Mike,
I'm on my iPad so I cannot do the @thing. You should shout out to @Rick Harmon. He's the master of probate sale. He can slice & dice it in 25 different ways with 55 different flavors. @K. Marie Poe might know this arena pretty well too.
I've gone through a couple of probate sales, but I'm in no way, shape or form, an expert on this subject. However, it's a very straight forward process.
Good luck.
Bill Gulley. You said it perfectly; read this and just go make an offer. Probate is one of the niches I work in. I just treat these sellers like any other motivated seller. You have to be very mindful of their situation and expect some delays. Otherwise it's just solving their problem nothing more.
Sharon
Yes, there are horror stories I'm sure, just like other areas of RE. You can slice and dice all you like, it's just as Sharon said, you solve problems and they are financial problems, not going into probate court (but you could to justify your offer). You get involved in the flavors between fighting siblings in the deal, while you might get a property, your value of the deal might be eaten up by all the hair pulling and frustrations suffered. You're not going to get a Public Administrator to sell on a contract for deed. An Executor and heirs may agree to almost anything and the probate court will generally allow anything that is agreed to that is legal. :)
Guys - The heirs only want one thing; the cash that is sitting in the house. If you can sweeten the deal by cleaning out the house that's usually all it takes. Like Bill Gulley said, I'm sure there are horror stories. But I personally don't know any. I love this niche.
Sharon
It's probably like other areas, made complicated with strategies applied to produce a product for mentors or gurus to push and present the area as being too complicated to make big money without thier guidance. :)
Great info. I've begun my process of sending out letters. I'm taking in as much info as possible as I hit the ground running. Thanks @sharon vonholt and @ bill gulley your insight is remarkable and greatly appreciated.
@Mike Neubauer, Probate is 80% of our business and I would love to help walk you step by step, from where to find the lead to how to contact them directly via phone and even know if there is Real Estate in the estate among other things like stocks bonds and other assets. Please email me [removed] and let's get you started.
@Mike Neubauer - probate deals are best thought of as properties with title problems. Probate may be required to pass title. Beyond that, they are generally procedural unless complicated by other factors.
It's the "other factors" that can mean the difference between a profitable opportunity to solve a problem that someone else either can't or won't, and a messy file that a family may insist on working out themselves using their own resources or even inexperienced legal professional rather than you, a skillful investor.
Minh L.
In CA., the three key documents when finding possible probate deals are; Petition for Probate, Order for Probate and Letters Testamentary (or Letters of Administration)...per Rick Harmon's knowledge as well.
Good Luck..