When settling the estate of an individual there are often hurdles and hiccups that must be navigated. If you are an Executor of an estate that has property to sell, we expect that you may have some serious questions. Read more about what to expect when you are appointed as an Executor in Ontario here.
In this most recent in our series of posts about executors and estates, we hope to clear up some of the common questions and concerns when it comes to selling a property that is part of an estate.
First steps to consider when selling an estate property.
If you are an Executor and have property to sell that belonged to the deceased, you must wait for the Certificate of Appointment of Estate Trustee (“probate”) to be issued by the court.
Probate is the process of the court authorizing who is the Estate Trustee and confirming the deceased’s will, if any.
Do you need to wait for probate before you sell?
The answer is it depends.
We know that there are reasons you may be tempted to list the property before getting probate. Some instances include the lender wanting to get paid, trying to sell quickly in a good market, and beneficiaries wanting their share of the property. If you must list a property before getting probate, you are obliged to make this clear in the real estate listing.
Potential buyers must be made fully aware that a set closing date depends on probate. The house can’t close without probate being issued.
Some tips for probate
- You can’t pick which jurisdiction you apply to for probate. You must apply to the jurisdiction where the deceased was living.
- Probate timing is different in every jurisdiction, but the approximate timeline in the Durham Region is 8 – 12 weeks from the time of submitting documents to the court.
- An estate lawyer can help you with the probate process.
Does a property always have to go through probate?
The answer depends on how the property was registered in ownership at the time of purchase.
Your real estate lawyer will ask how you want to register ownership.
Option 1: Joint Tenancy . If one owner passes, the other one becomes the sole owner by legal right, with no reason to do probate. The one who survived is the one who can sell the house.
Option 2: Tenants in Common. Each owner is a separate entity. The deceased owner’s estate must go through probate when the surviving owner wishes to sell.
The status of ownership can always be found by doing a title search with your real estate lawyer. How you choose ownership can be an estate planning tool dependent upon your situation.
Here are two examples for you to consider.
John recently passed away. Susan, his wife, would like to sell the property and move to something smaller for herself. If Susan owned the property with John and at the time of purchase they registered as joint tendency with their real estate lawyer, then the property does not need to go through probate. At the time of John’s death, the property moved solely into Susan’s ownership and Susan is free to do what she wants with the property.
Susan owns the property alone. John passed away and Susan decided to stay in the property. Susan passes away 5 years later. At the time of her death, she has 3 children. Mike, Tom, and Eileen. Mike is the Executor of the estate. At the time of Susan’s death, she was the sole owner of the property. Before Mike can sell the property, he must apply for probate of Susan’s estate.
McMurter & Associates has you covered.
It’s no secret that selling a property as an Executor is not a simple process. It will likely come with some feelings of stress, but your estate lawyer can help walk you through the process and make it as smooth as possible.
McMurter & Associates has been providing estate planning services for over 30 years in the Durham Region. If you have any questions about your will and estate planning, we are available Monday to Friday, 9am until 5pm. Email: info@mcmurter Phone: 905-666-9200