How to avoid probate

8 Replies

Hi all

I have been recently contacted by a couple of different people here in Tennessee, regarding properties that they want to sell. both are having to do with the death of the owner. 

The first one was the niece of the owner who has not passed away yet, but is expected to very shortly. She called because I had mailed a letter to the owner and she wanted to let me know that the owner was probably going to die soon and, once she does, she is going to want to sell it. She also said that the owner's daughter is living there currently, but is in agreement to sell the house. I do not know whether there is a will in place or not, I have tried to call her back and see what is the case in regards to that. But assuming that there is nothing in place (the county records show ownership being solely with the dying aunt), what is advisable to avoid the probate process in Tennessee. 

The second scenario: I was called by the daughter of one who is recently deceased. She is wanting to sell the house that her mother was said to be the owner of. She said she wanted to sell without having to go through the probate process, if possible. I told her that she was probably going to have to, since (according to her) she has nothing that grants her automatic ownership of the property. On the phone, she stated that the house originally belonged to her grandparents who are deceased. She said that it was then passed to her mother who died as of less than two weeks ago. Upon looking up the property records, I discovered that the grandparents are recorded as being the current owners as of about 1960. 

Any thoughts or suggestions on these two scenarios? They both seem to be great opportunities if they can be worked. I don't want them to go into probate and become public!

    Pre-death transfers are possible however you treading in potentially dangerous territory if you interfere with complex estate planning issues.

    Issues concerning the competency of the transferor, intra-familiar dynamics (potential for will contests, etc.) and other pitfalls are not appropriate for the real estate investor to be involved. 

    This leads you, as investor, to make a referral to a local probate/estate planning attorney or two and stay out of the way.  

    It's ok to stay in touch with family as you're now an insiders, but you don't want to be brought into any type of later dispute if there are fights between siblings.

    Rick is the one in the know about probate. 

    But there are some states where things can be done without probate in certain scenarios. I don't know if Tennessee is. 

    In Georgia I have bought several vacant lots from descendants  with affidavits. The owner of records must have died at least 7 years before and the person trying to sell must be the actual people, who would be in line to inherit, if probate were to be done.

    @Michaela G.  I see the issue that concerns me is that the owners are still living and have not transferred property during their lifetime. 

    If the living owners had capacity to pass title to an offspring now, I gues the child could sell. I'd want title insurance with an escrow and would not complete until vacant. 

    Rick you're right. but I was thinking of the 2nd scenario, where the owner of record, her grandparents , died many years ago.

    I know in Georgia this is an acceptable way, because most black people didn't trust white attorneys, so, they just handed properties down within the family without doing any kind of probate. That happened a lot in the South, due to previous slave holdings and blacks having been taken advantage off by whites and therefore it's understandable that there was mistrust against whites and nobody wanting to deal with a white lawyer.

    Then someone down the line wants to sell a house and finds that the title is still in someone several generations before and it would take 5 different probates to convey clear title.

    @Michael Campbell

    Rick voices some valid concerns, depending on how aggressive you are.  On the dying aunt case, if you have full cooperation of all family members, and the aunt is alert enough to understand what she is doing, I would get a deed, going through the title company.

    On the second case, consult with the title company attorney, (not a title or escrow officer), to determine if a probate or a quiet title action is required to obtain good title.  Do not fear publicity of  a probate publication; if you have the real property under contract, the true purpose of publication, which is to notifying creditors, will not defeat your property purchase.

    To clarify, when I'm talking about Georgia accepting affidavits in some cases, that still goes through a closing attorney or title company. They are the ones that are accepting of this procedure and will give title insurance.

    Originally posted by @Michaela G. :

    Rick you're right. but I was thinking of the 2nd scenario, where the owner of record, her grandparents , died many years ago.

    I know in Georgia this is an acceptable way, because most black people didn't trust white attorneys, so, they just handed properties down within the family without doing any kind of probate. That happened a lot in the South, due to previous slave holdings and blacks having been taken advantage off by whites and therefore it's understandable that there was mistrust against whites and nobody wanting to deal with a white lawyer.

    Then someone down the line wants to sell a house and finds that the title is still in someone several generations before and it would take 5 different probates to convey clear title.

    I went through something similar in a deal in Texas many years ago. Original '40 acres and a mule' freedman's grant at the end of the railroad line. Had to get agreement and signatures of 16 descendants in order to make the deal work. Took nearly a year. The last holdout wouldn't budge even with an upped offer. The sticking point was finally determined to be that they didn't want a check, they wanted green cash. Cash was shown, they signed. It was a great piece of property. Black walnut trees lined two borders of the property. The trees alone were easily worth double the purchase price. No, we didn't cut down the trees!