Leicester, MA · Member since 2016 · 137 posts · 36 votes
Hey BP community, I’d love some feed back on a house I’m potentially working on given the situation. The owner, Peter, passed away in 2011 and his niece Maria became the executor of the estate. In 2017 there was a house fire they were pretty much robbed by the contractor who low balled the estimate to get the job then took off with the money. In August of 2018, Maria passed away.
When the executor of Maria’s estate (sister Vivian) becomes the actual executor does she has the right to sell this house that’s still in Peters name? If not, what does she have to do?
The mortgage balance ($219K), cost of repairs (roughly $85K), is too much for the ARV ($250K). Is it possible for Maria to take the insurance money and short sale the house or is she required to use the money towards repairs only?
Investor · Los Angeles, CA · Member since 2012 · 1k+ posts · 500 votes
7y
Executorship is needed to do a short sale if borrower(s) are deceased. What type of loan is on the house?
That's a sensitive question to ask about the insurance money but if tht money is given it typically expected to be used to fix up the house. The servicer will ask about the insurance money likely if it is not used to fix up the house or they may deny the short sale based on that factor if that occured. At times there is a document signed that comes with the approval letter that the servicer keeps any insurance money left over if a short sale is to go through.