Buying a probate property can mean getting a great deal, but it does involve a few things you should be aware of before you start. Read on to find out more about the process.
What does ‘probate’ mean?
Probate is the legal procedure in which the executor of a dead person’s estate distributes the assets and money to the beneficiaries (the people mentioned in the person’s will). During probate, the executor carries out the person’s wishes and sometimes sells various assets to pay off debts and to distribute the remainder between beneficiaries.
In most cases, this process is smooth and efficient, but there can be hitches and house sales are especially prone to hold ups and complications.
Executors need a grant of probate
A grant of probate is a legally-binding document issues to executors by the deceased. If the deceased didn’t leave a will (this is known as intestacy), then the next of kin usually assumes the role of executor. They can, however, only do this once they have a grant of letters of administration.
Make sure the vendor actually has the right to sell the property
When you’re planning to buy a probate property, you should first make sure that the vendor is legally able to sell. You need to find out if the vendor has a grant of probate, or is at least waiting for one. The spouse or partner of the dead person can sell the property before receiving a grant of probate, but they can’t exchange contracts until they have the grant. Applications for grants of probate can take up to 12 weeks, so factor this into any decisions.
Find out if all beneficiaries agree to the sale
If any of the beneficiaries don’t agree to the sale, or to the division of the proceeds, then this can delay and complicate matters. In some cases, the dispute could end up in court, which will probably cause huge delays.
You can ask the solicitor representing the estate if they have power of attorney to act for the beneficiaries, as this can help if some beneficiaries are unreachable or obstructive.
How to find probate properties
You can find probate properties in the same way you’d find any others – through your local estate agents. Asking a local estate agent about a probate property is particularly useful because they’ll have knowledge about the area that the vendor or solicitor may not. The vendor may never have lived in the area, let alone the house, so having someone “on the ground” can come in handy.
Making an offer on a probate property
Making an offer on a probate property is no different from a regular offer process. The executors might have a valuation on the property immediately after the owner’s death for inheritance tax purposes, but you’ll be working from market values.
It’s possible, however, that the vendors might accept a lowball offer simply to end the probate process and release the value in the property. Start off with a lower offer but be ready to increase it so that you stand a good chance against rival house hunters – probate properties can attract a lot of attention. You should also factor in the cost of any improvements you might need to make as any necessary work will be your responsibility once you take ownership.
Buyer beware
The responsibility for repairs or improvements after the exchange of contracts is known is legal parlance as caveat emptor, or ‘buyer beware’. Probate properties are often sold by people who haven’t lived in them for years, if ever, and so the vendors have limited knowledge about them.
Probate vendors can only fill in the TA6 (Property Information) and TA10 (Fittings and Contents) forms to their best ability, so you might find a lot of questions have ‘Don’t know’ as the answer.
As a probate buyer, then, you’ll need to be aware of these risks and arrange for extra surveys and checks. You should have surveys done on the electrical, gas and plumbing systems, as well as a thorough building survey. If the property is older or has been unoccupied for some time, then you’ll also need to look for mould or structural issues – remember, they’re your responsibility once you take possession.
Improvements to probate properties
As the previous owner may well have been elderly and in ill-health (maybe in a nursing home), it’s likely that the property will need some TLC and you should factor these costs into your plans. Do try to be sensitive towards the vendors, as they may have emotional attachments to the property; it may have been their childhood home, after all.
To sum up
Buying a probate property can be a bit more complex than a regular purchase, but if you feel you’re getting a good deal and you don’t mind waiting a little longer, it can work well for both sides. Just make sure you make all the necessary checks.
