may be some similarities in different states, but the documentation required in
a closing involving an estate is determined by state law and you should discuss
these situations with an attorney licensed to practice in your state. The title company insuring the transaction
will also have specific requirements regarding how to handle a particular
estate issue and those requirements may vary between different title
underwriters located in the same state.
The analysis of different situations in this blog is based on Tennessee
of Estate Terms.
are some terms you may hear when dealing with a closing involving an
- Testate: having died with a will.
- Intestate: having died without a will.
- Holographic Will: a handwritten will.
- Nuncupative Will: an oral will
- Probate: the process of proving a will in court.
- Executor (Executrix): the personal representative of a testate estate, named in the will and appointed by the court.
- Administrator (Administratrix): the personal representative of an intestate estate, appointed by the court.
- Muniment of Title Probate: probate with no administration for the purpose of establishing title to real or personal property.
- Insolvent Estate: an estate where there is not enough personal property or assets to pay all valid claims against the estate.
Seller signs a contract to sell real estate and dies before closing.
this situation, it is likely that an estate will need to be opened in probate
court. After a personal representative
is appointed, that person would be able to convey the property to the buyer. This is different from a typical closing
involving an estate because the seller actually signed the contract before she
died. Since she signed the contract, her
estate is bound by the terms she agreed to in the contract and the personal
representative of her estate is authorized to sign on behalf of the
estate. The typical estate requirements
that we will discuss below do not apply.
A husband and wife own
property, the husband dies and the wife wants to sell the property.
order to sell the property, the widow will likely only need to provide a copy
of the husband’s death certificate. If
both of them were not on title to the property or if she did not have a
survivorship interest, she will need to provide more, as discussed below. But if they were both on title to the
property and had a survivorship interest (which can be determined by reviewing
the deed to the husband and wife in accordance with the laws of the state where
the property is located), she will only need to prove that he is deceased.
Sam owns a three bedroom house
and dies intestate. He is unmarried and
has 2 adult children, who want to sell the house as soon as possible.
children would not be able to sell the house within 60 days from the date of
his death in Tennessee under any circumstances.
There is a Tennessee statute that gives priority to a deed from the
decedent that is recorded within 60 days after death. If an estate is being administered, creditors
of the estate have 4 months to file claims against the estate, so the children
would not be able to close until the 4 month claims period has run and the
title company has verified that no claims have been filed. However, in some situations, they may be able
to close before the 4 month claims period if there is proof that the sale is an
arm’s length transaction for market value, but the net proceeds would likely
need to be held in escrow until the 4 month claims period has run. If Sam was age 55 or older at the time of his
death, the 2 children will need to obtain a TennCare Release before they would
be able to close. If Sam’s estate is not
being administered, his 2 children may be able to close after 6 months from the
date of his death as long as they have a TennCare Release.
Sally owns a condo downtown and
dies testate. She is unmarried and does
not have any children. Her will names
her brother, Bob, as Executor and leaves her condo to her church.
has admitted the will to probate and wants to list the property for sale. He has told you that since he is the Executor
that he has the right to sell the property.
If the will contains language that the real property is to be
administered as part of the estate subject to the control of the Executor, Bob
would be able to sell the property as the Executor of Sally’s Estate. Also, if Sally’s estate is insolvent, Bob may
sell the property to satisfy creditors of the estate. This will likely require a court order
declaring that the estate is insolvent.
If the will does not contain that specific language and the estate is
not insolvent, a representative from the church would need to sign in order to
convey the property. However, before
that transaction can close, there would need to be a TennCare Release (if Sally
is age 55 or older) and the 4 month claims period has run, or it has been 1
year from the date of Sally’s death, whichever is earlier.
Steve owned a 20 acre farm that
was only in his name and died intestate 15 years ago. He had a wife, Sara, and 3 adult children.
wants to sell the 20 acre farm and said that since she is Steve’s widow that
she should be able to do that since she hasn’t spoken to her children in 5
years. Under Tennessee laws of Intestate
Succession, the wife and all 3 children would inherit the property and would
all need to sign in order to convey the property to a buyer. A TennCare Release would likely not be
necessary since Steve died 15 years ago.
Affidavits of Heirship would probably be required from someone who had
enough knowledge of the family to identify Steve’s spouse at the time of his
death and all of the children he had during his lifetime. Once all of those heirs are identified, they
would all be able to sell the property.
Not being able to locate any of the children is not sufficient, as their
interest must be conveyed in order for the buyer to have clear title to the
Consult a local attorney or
These are just a few
examples of situations you may encounter and some things that can be done to
help close these transactions with as little delay as possible. Since laws vary greatly from state to state
and title underwriters may have different requirements based on their
interpretation of state law, you should talk to a local attorney or title
company about the specifics of your transaction and always inform your title
company if one or more of the property owners is deceased, so they can research
and find out what they will need in that particular situation.