By: Amy Snook Contributing Writer
“I am calling because I need to sell my parents’ home.” This is a phone call we receive all too often. Certainly, we all respect a child wanting to help their parents but depending upon the estate planning done in advance, this may or may not be an option.
We recommend to all our buyers to discuss estate planning with an attorney. While the property can be properly titled at purchase, sometimes there is simply not enough time prior to closing to get it all done. That is ok – it can still be done after closing and an attorney can work with you to transfer the asset (your home) into the proper title to protect assets, avoid probate and many other estate planning tools.
When you are making a decision to sell a home or in the case above to assist in the sale of your parents home, it is important to understand how the home is titled upfront and any work needed to be completed prior to going on market. Interested buyers typically want to close quickly once under contract and may not be willing to wait six months for probate to be completed.
So, understanding what you are dealing with is essential. This is where a knowledgeable Realtor is imperative.
When we are presented with a listing to sell a home, we start by looking in public records at how the home is titled.
If the home is titled individually (John Doe and Jane Doe, husband and wife), our first question is, Are John and Jane both alive? If yes, are they of sound mind to be able to convey the home? Often adult children will say, “I have a Power of Attorney and can sell my parents home.” Relying on the Power of Attorney depends on several factors and will need to be reviewed prior to confirming the ability to rely upon the use of the Power of Attorney. Factors such as if the Principle (in this case John or Jane) are of sound mind, does the document include the necessary language in Florida, review of the powers of the Attorney in Fact (in our example the adult child), is it both witnessed and notarized and several other verifications that need to be completed prior to confirming of its use.
Unfortunately, and something that many do not realize, the Power of Attorney ceases to be in effect at the time of death of the Principle (John or Jane in our example). This brings us to our next all too common scenario – the death of the last surviving owner.
Again, in this scenario we start with the title. If titled individually (John Doe and Jane Doe, Husband and Wife) with no language of transfer upon death (life estate), without a trust or any other estate planning tool and language – we very well may have a Probate scenario. Probate is a legal process for distributing assets/property after death. Probate can take time and many buyers will not want to wait for the process to complete – this is the very reason why probate needs to be started prior to listing the home. We as Realtors need to work closely with the Probate Attorney during the process so when we go to market and procure a buyer – we can get the sale completed in a timely matter. Probate can get complicated – there can be multiple heirs, personal representatives and many who need to be involved in the listing and sale of the home.
There are many tools to avoid probate but again they need to be done up front, when all parties are alive (and even easier if all are of sound mind) to title the property in a manner that sets up the process for when a party dies. Tools such as title in a Trust or a Life Estate are some of the more common ones in Florida. An Attorney can work with you to create the right estate planning strategy.
We understand that once you decide to sell a home, you are envisioning the sale and close and are ready to start the process. Finding the right, knowledgeable Realtor, and taking the time to evaluate title and the process will save time, frustration and even money.
About Amy Snook
Amy Snook, a 1990 graduate of the University of Maryland, is a partner in the All About Florida Homes team of Keller Williams Realty, along with co-partner Noreen Payne of Delray Beach. She has been practicing real estate and title insurance for 17 years and is currently the Florida State Vice President for Women’s Council of Realtors. Amy is also a director of the Realtors Association of the Palm Beaches and Greater Fort Lauderdale and a director of Florida Realtors. She resides in Atlantis, Florida.