On face value, most real estate transactions just aren’t that complicated. They only become complicated when we add bank financing, title issues, bank releases, code violations, disclosures, non disclosures, fires, flooding, foreclosure, divorces, Probates and/or other people on title that are not supposed to be there. That is when real estate transactions begin to unravel and people lose their minds and sales fall apart.
Sometimes the issues surrounding a house in Probate and its title become so convoluted that it takes one person to manage and unravel the mess. The problem is that the “One Person” that is responsible, is generally the executor and they are NOT prepared to organize and manage the details coming from the underlying issues and most often they need outside help.
Today’s article and video talk about those issues and one lady and one house with hidden title issues that drug on for nearly 40 years.
While most people have heard of a Probate, most people really dont know what it is, how it works or how to avoid it. Some think, that all you need is a will to keep you out of Probate Court. While having a will, certainly helps the process, it does not allow you to avoid Probate all together. In fact, the only thing that will allow you to skip probate that I am aware of is a living trust. Unfortunately most people do not have living trusts and are subject to the adjudication of the Probate Courts.
Fortunately you can sell a house while it is still in Probate and it is a pretty simple thing. That is until someone shows up on title that shouldn’t be there. It happens more often than most people realize and in some states, like Oklahoma they anticipate it from time to time. There, they are referred to as dead indians. Yes, these are actually Native Americans that show up on title because at one time they actually owned the land in question and passed away without any heirs.
In California I am not aware of any dead indian’s, but I have run more than one case where a mother-in-law was still on title. It happened that way for Maria, 38 years after her mother in law had passed away. The truth is that most homeowners dont find out about any title issues until the house is sold and the title company orders a Preliminary Title Report. By then everyone is anticipating a sale and closing, not a “oh, wait, let’s put the brakes on this sale for a bit until we get this all cleared up”.
Could you imagine trying to buy a house and having to wait 18 months before you could actually call it home? What would you do? What does the Seller Do?
Selling a house in Probate, even with some minor title issues is usually relatively simple process and as long as there is one person spearheading the process, . Generally speaking, the title officer calls the real estate agents and rounds every one up asks the right questions, gives some basic directions to the seller and the seller runs to his or her probate attorney and the wheels are set in motion. In normal circumstances that might be a two to eight week process. In this case no one knew what to do or how long it would take or how much it would cost.
As the Seller if you need to Sell Your House in Probate, who do you turn to?
The listing real estate agent. Hardly a refuge, she didn’t have a suggestion. She had never even heard of a probate that old and told me it was over, that the house would never sell. I saw that coming… she was part time, around 28 years old and 3 years on the job. In her defense, real estate agents aren’t specialists especially when we are dealing with a decades old probate and real estate title issues. ( I really hate letting them off the hook this easy)
The Title company? Not a participant, just the independent 3rd party trying to accommodate everyone and pass clear title to the buyer. Title officers can only identify the problems and tell you what you need to fix them. They are not the fireman to put out the fire… at least not yet and at least not yet in this story. They advised the seller to contact a Probate attorney. No they did not recommend one, they just said one was needed.
The probate Attorney? He didn’t exist yet. Probate Attorney understand the process and are capable to file all of the motions, petitions, notices, provide evidentiary documentation and the like. I know for a fact that they do not locate a dead mother-in law or her children that dont want to be found. Pretty soon it becomes self evident that no one knows what to do and the whole process is at a virtual standstill.
But wait, let’s add more to the complexities… the seller has no money and can’t afford to hire a probate attorney and decides NOT to sell the house. She gives up.
So whom have we forgotten? The Buyers real estate agent? Maybe the Buyers agent can help spearhead this through. Buy wait there is no Buyers agent, because I always represent myself. That means there is just me… Peter Westbrook, local real estate investor… cash home buyer in Stockton, Sacramento and Modesto.
The title Company calls me and says, it looks like this sale has fallen apart…
She tells me that we need to get Sally to sign off on the house before we can move forward. The Seller says Sally is dead and that she paid Sally’s daughter $60,000 twenty years ago for her mother’s share of the house and that same sister in law was to settle her mother’s estate in a Probate and remove her from the title of Maria’s house.
But that stops dead in its tracks, because Sally’s daughter finds out that if she completes the probate of her mother’s estate that she will have to divide that $60,000 up between her 12 brothers and sisters. Which, after 20 years would mean that all 12 brothers and sisters would need to sign off on everything while knowing some of them had also passed away. Talk about a Rabbit Hole? So the sister in law just took the money and hoped everyone else would forget or better yet give up like Maria was prepared to do.
Imagine being 84 years old and everyone has given up or is worse yet, throwing roadblocks in your way. All you want to do is liquidate the equity in a house that has haunted you for many years. Now add a final component. During all of this, you are notified from the City of Stockton that there are Code Violations on the house and when you arrive to inspect it the locks have been changed and you dont know it yet but there is a very sophisticated squatter that has taken up residency in your house.
That was the last straw, but Maria was done unless someone else spearheaded the next move. I’ll never forget the call that I received. She was in tears and her granddaughter was her only moral support. At that moment I knew only one thing. If Maria was in I was in.
My name is Peter Westbrook and patient is not how you might describe me. When I make a decision, I am ready to go and that means developing a plan and moving forward. Let’s just say that as much as Maria wanted to sell, I wanted to buy the house, but I knew that unless she was committed to the outcome there would be more hurdles and landmines and I wasn’t willing to invest thousands of dollars into a process and a plan that she was not committed to completing.
If you would like to sell your house in Stockton, Sacramento or Modesto, or you would like to know how we unraveled the mess for Maria, give me a call and I’ll tell you the story personally. I am a real estate investor in Stockton, Sacramento and Modesto. We buy houses, pay cash and when we make a commitment to buy your house we follow through. What happened next has a happy ending. It didn’t happen overnight, but when we were done, Maria sold her house. We tracked down her deadbeat sister in law, we paid for the probate of her dead mother-in-law. We evicted the squatter two times and had them arrested once and today Maria and I still talk.
Hello, my name is Peter Westbrook with Westbrook Real Estate Investments. Today, I want to do a little video on probate and what happens to houses that are stuck in the middle of title issues.
I purchased this house in July of 2016. In that time, we went to title to close on the sale, and we found out that not only did the lady who owned the house that was on title, she also shared title with the mother-in-law of her husband who had passed away 40 years ago. Her mother-in-law passed away 35 years ago, and the house had never been through probate. The family didn’t know what to do.
The heirs of the mother-in-law lived in North Carolina. There were actually nine brothers and sisters that could share in the estate. They each had a number of children, and many of those siblings passed away as well. So can you imagine untangling a 35-year-old probate? It took a year and a half. We had file it in West Covina, California. We are in Stockton, California. I know most investors just don’t have the stomach or the time or the money.
The probate itself cost roughly $15,000 to go through, plus paying for squatters that have lived in this house on and off. We actually had them evicted and then arrested and then arrested. They kept coming back. We boarded up the house. They kept taking the boards off. They actually rigged the water in the house to work. We finally did get them out. But after a year and a half of probate, we were finally able to take possession of the house, and now we are ready to start the rehab of this.
But if you are a homeowner and you have a house that needs to go through probate, then give me a call. My name is Peter Westbrook with Westbrook Real Estate Investments. My phone number is (209)481-7780.