Receiving an inheritance comes with a great deal of responsibility and legal procedures, which often make the entire experience even more challenging to get through. Before the deceased person’s assets can be distributed to their heirs, the last will should get through the probate process first.
Sometimes probate takes months or even longer than a year (you can find more information about it at https://probateadvance.com/how-long-does-probate-take/), and if you are going to sell the inherited property anyways, it’s not worth the wait. But can you sell the property before the probate process starts?
If this is what you’ve been looking for, keep reading! In this article, we’ll discuss in which cases you can sell the inherited property without probate, in which not, and what you can do about it. Let’s figure it out!
Reasons to Sell Inherited Property Before Probate
There are several good reasons why selling inherited property before probate may be the best option. Here are some of them, which should make you consider them.
You Can Use the Money for Your Own Needs
The inheritance itself is a great thing, but it’s only a bonus if you actually use it for your needs and purposes. If you receive the inheritance and still have to pay off debts and bills, it’s better to sell the inherited property and use the money for your own purposes. After all, the person who left you the inheritance surely didn’t want you to spend their entire fortune on your debts, right?
You Have No Need to Wait for Probate
Some people don’t mind waiting for the probate process to take place – they feel like there’s no rush and everything will work on its own. But what if you have your own family obligations to keep in mind? If you need to move into a new house because your family has grown, or you want to go back to school so that you can get a better job, then waiting for probate may not be the most convenient decision.
You Can Get Better Prices for the Inherited Property
One more thing that makes selling inherited property before probate a great idea is that you can get better prices for your inherited property. If you put it up for sale at the right time, you may even be able to sell the property for more than it was worth when the deceased person owned it. In that case, you’ll be able to get even more money than you were expecting after the probate is over.
You May Need the Money Fast
In case if you’re facing a serious financial challenge, selling an inherited property without probate may be the only way out. And when you need money fast, it’s always a good idea to check if you can sell the inherited property before probate is over.
When You Can Sell the Inherited Property Without Probate
When you inherit something, it belongs to you. However, if the probate court decides that the deceased person didn’t have the right to leave it to you, you won’t be able to keep it. This is when probate comes in handy: it protects the heirs against anyone who would try to claim rights over the property.
However, selling the inherited property before the probate process starts is possible if the deceased person had an ownership interest in it. You can sell assets that don’t need probate and those that are worth less than $150,000 (this amount may vary depending on the state) at any time. The small estate administration process applies to the latter, meaning in this case, you can sell your inherited property without probate. However, if it belongs to someone else (like if you inherited a house), you won’t be able to sell it without having a court order.
What if You Inherited Real Estate?
Real estate is more complicated than other property since it has value and can be sold only if you own it entirely on your own. If you inherited real estate with other people, then even though the property is yours now, you still have to wait until the probate process is complete for selling it. If other people own parts of the property with you, they will have to sign a document giving up their rights before you can sell it. In this case, probate won’t just protect you; it will also protect your co-owners.
However, it’s important to note that if you inherit real estate as a result of divorce or the death of your spouse, you can sell it immediately (as long as there are no children involved). In these cases, probate isn’t necessary since neither of the parties is interested in keeping the property in question.
What if You Inherited a Vehicle?
Another thing that you can sell without probate is a vehicle that was not used as a family car. This means that if you receive a motorcycle or a boat as an inheritance, you can sell them without probate. However, if everyone in your family used the vehicle, you will have to file for probate no matter how much it’s worth.
When Selling the Inherited Property Is Not Allowed
As we have already mentioned, there are certain cases when selling an inherited property without probate is not allowed. For example, if you inherit a life insurance policy, you cannot cash it in unless you have received a discharge from the insurance company.
You also cannot sell an inherited annuity without getting permission from the annuity issuer or, in some cases, a court order. Annuities and life insurance policies should be transferred into a beneficiary’s name only after being discharged from them.
If it turns out that the property was owned by a trust fund and not by an individual, then it won’t work out for you. You will need to file a petition with the court for permission to transfer or sell it in this case.
If there isn’t any explanation of who owns the property or how many people are involved in the process, you should apply for permission from the probate court before you start selling it.
Also, if you inherit something worth over $150,000 (this amount varies from state to state), probate will be necessary for its sale as well. In this case, not only will you have to wait for the court decision (and pay all of the fees associated with it), but also provide proof that the deceased person wanted you to keep this particular asset in your possession. Otherwise, it may be returned to someone else.
There are some reasons you might be interested in selling an inherited property before the probate process starts. You may want to get a better price for it or just need the money fast. However, there are some cases when you can sell an inherited property, such as non-probate assets, and circumstances when it is not allowed – for example, if you inherit a property worth over $150,000.
If you are not sure whether you can sell the inherited property without probate or not, just contact the probate court. They will be able to answer your questions and tell you what to do in this specific situation. If you have additional questions, don’t hesitate to ask them.