Another Estate Home Sold!
Our Team just closed on the sale of another estate home where we represented the sellers. This was a home sale for clients who had a home still in the “probate” process of the estate of a loved one who had passed away. This is not the simplest kind of real estate transaction, and requires a high level of real estate experience to get over the finish line.
How did this situation come about?
An elderly couple owned the house, but the husband passed away several years ago, and the wife passed away in December 2017. In this case, the home was now owned by the estate, but there were 5 daughters in this family who were responsible for getting the property sold, or continuing to maintain it. The 5 sisters decided to sell because they did not want to become landlords and rent the property. They also did not want to continue to maintain the property, pay the mortgage, pay taxes, pay insurance, and pay to have the lawn mowed.
We listed the house for sale in early April 2018 for $175,000. We received a low-ball offer in May, but the 5 sisters did not want to go that low, so we rejected it. We then received an offer they could live with in June, and prepared to close at the end of July.
The challenges we encountered…
The challenge at the beginning, in pricing this home, was to pick a price within the market range and would get the estate enough money to pay off the mortgage and other closing expenses. While we did much better than “just getting by” there were several hurdles along the way to getting this home sold and closed.
We faced several challenges. Due to the house being vacant, the lender who held the loan against the house was concerned that it would not be maintained. They even sent a property management company to check on it and threatened to change the locks and “take it over”. But thankfully, after we talked to the property management company, they reported back to the lender that we were maintaining the house nicely.
Next, in May, we were told by the homeowners insurance company they were going to cancel the insurance policy on the house because it was vacant. Thankfully they set the drop dead date for the expiration of the insurance policy to August 2018. We had to get this house sold and closed before the end of July, and we did it!
Then in June we had torrential rain in the Cave Spring area of the Roanoke Valley. We had a trickle of water in the basement that made the family room carpet wet, so I notified the family. One of the sisters, who was my main contact, immediately drove from her home in Maryland and set up a clean-up contractor to remove the carpet and dry out the basement quickly so there would be no humidity or mildew. We avoided all that by being on top of the situation, but then we needed to add to our listing that the house gets a trickle of water in the basement during heavy rains.
Closing an estate transaction.
If when selling an estate home, the estate has not been settled (usually takes over a year in Virginia), then the estate also has to buy a “surety bond” at closing in order to protect any potential creditors in the event the estate still owes anyone money after the property is sold.
Also, if no “Personal Representative” (or Executor) is assigned at the start of the probate process, then all heirs have to sign the deed at the closing of the sale. In our situation, there was no personal representative. And, the 5 sisters each lived in different states, so the closing office had to FedEx seller deed packages in 5 different directions. The sisters then had to each sign their documents in front of a notary public and FedEx back the documents. This was all done within the last week prior to closing, and the last FedEx package came back to the closing office on closing day! Whew!
While there was a lot more intrigue in this closing, suffice it to say we had a very exciting time getting this deal closed. It closed in late July 2018 for $161,000 with a few weeks to spare before the homeowners insurance ran out. What a day at the office!