If you’re looking for a real estate opportunity where the sellers are highly motivated, the properties can often be bought at a deep discount, and the competition is minimal, consider investing in probate real estate.
What, exactly, is probate real estate? When someone passes away, their inheritance is divided between the heirs. When the inheritance includes real estate, it is referred to as probate real estate, or simply a “probate home”.
Though investing in probate homes can be highly profitable, many people shy away from it, often because of some common misconceptions. In this article, we clear up three of them.
Probate Myth 1: It’s extremely difficult to buy probate homes. One of the most difficult aspects of probate investing is simply the waiting, not the imagined red tape or endless hoops to jump through. The process can sometimes be slow, because the decision to sell the probate home must be agreed upon by all of the heirs. But once this occurs, the estate executor can sell the property. Sometimes, the sale of a probate home must also be approved by a judge. Even when this is the case, the agreement of the heirs is usually all the court needs to approve the sale.
Probate Myth 2: Owners of probate homes (heirs) are usually hard to deal with. Although there’s no accounting for individual personalities or family dynamics, many owners of probate homes are anxious to sell (sometimes even at a below-market price) so that they can settle the estate. Many times, the inheritance money is tied up in the property of the deceased, and a quick sale enables the heirs to pay off the deceased’s debts and divide the remaining inheritance as cash.
Probate Myth 3: Probate homes are difficult to find. Probate real estate information is a matter of public record. At your local courthouse, you can obtain a list of all wills presented for probate. More courthouse research will uncover the records of deeds to properties held in the name of the deceased. You can also find information about possible probate homes in online newspaper obituaries.
If you’re willing to do a little legwork, probate homes can present a lucrative investment opportunity for you. Even though you do have to do some research, probate investing is much easier and more rewarding than many people believe.