The death of a loved one can be extremely challenging and handling a person's estate may feel overwhelming, especially when any property is involved. Usually, the home is inherited, staying within the family. In some cases, when a homeowner dies, the house is passed to the name on the deed or falls into the hands of the courts. It's why understanding and buying into an estate plan is essential.
Finding the Right Executor
While planning your estate, consider your family. You may find that one person is more willing to be named executor. This designated individual shepherds the estate during probate, though hyper-focused on the finances. Before distributing any assets, the executor must pay off debts, which is when many decide to sell the property left in the estate to increase cash flow.
Executors are responsible for guaranteeing enough funds to pay off these debts. If they outweigh assets, the executor has the right to set the asking price on the home to cover the costs. Consider also that if ownership changes, the home's inheritor may procure additional fees and taxes.
The estate will be subjected to probate when a proper estate plan or will is not in place. A court-supervised procedure, probate pays off debts, closes accounts and distributes any belongings of the deceased individual. The court locates beneficiaries and heirs, protecting the family's rights to these belongings. Based on the state's Next of Kin laws, the probate court determines what is inherited and to whom. Without a proper executor, the court controls how to pay remaining debts or feed. This is typically done by selling the property on behalf of the estate.
To avoid confusion and save your family from having to deal with matters outside of their control, work with a trusted professional to review the details of an estate plan that best fits your and your family's goals.