You Have a Property to Sell: NOW WHAT?

A Discussion of all the tools necessary for a Court related real estate transaction

Goal

To help fiduciaries market real property with the intent of getting the greatest value for the estate and, at the same time, minimizing the estate's liability.

Table of Contents

Do's and Don'ts in Preparing the Property for Market

Criteria for Choosing the Right Agent

Contractual obligations

During the Listing

The Offer Process

Escrow Process

Closing

Preparing the Property for Market: Occupancy

Vacant

1. Easier and more accessible for agents to show

2. Don't have to rely on tenant cooperation with showings and access

3. Tenants may obstruct showings with negative comments

4. Property may not be maintained by tenant

5. Expediency of eviction process prior to listing

6. Other than multi-residential properties, tenants will be expected to vacate prior to close of escrow or 'tenant in Possession' verbiage must be made part of the offer.

Occupied

1. Rental Income

2. Security/Insurance Issues

Preparing the Property for Market: Property Preservation (vacant)

Initial clean-up:

1. Re-key if deemed necessary

2. Install a combination lockbox for use by appraisers, utility companies, maintenance vendors and others

3. Post a "No Trespassing" notice in a window or other visible location

4. Remove all Personal Property and valuables including automobiles

5. Remove interior and exterior debris (de-trasher)

6. Mow grass and treat weeds

7. If there is a pool, whether filled or not, make sure all gates have locks on them

Maintenance:

1. Keep all utilities on

2. Maintain landscaping appearance

3. If there is a functional pool, maintain service

Repairs:

1. Make no repairs to the property other than those that may be required to preserve safety, limit liability or protect the property from immediate danger

Preparing the Property for Market: Inspections

* Every inspection done by seller must be presented to all interested purchasers and becomes an automatic disclosure

* Any inspection done by seller becomes a potential liability to estate

* Any inspections presented to seller or seller's agent must be disclosed to all interested parties

Preparing the Property for Market Re-hab

DONT!!!

Does Re-hab add value to the estate?

NO!!!

Preparing the Property for Market: Publication

Make sure the property has been properly published prior to activation of the listing. Failure to do this will result in the accepted offer being nullified.

Do's and Don'ts in Preparing the Property for Market (Summary)

Do's:

1. Clear up any title issues

2. Remove valuables and personal property

3. Remove all debris inside and out

4. Maintain property until closing

5. Utilities on

Don'ts:

1. Inspections

2. Re-hab

Choosing the Right Agent

* Agent you have used in the past

* Prior experience with court related sales

* Referral from another fiduciary

* Agents that you have seen at court (experience)

* Asset Management specializing in Estate sales

* Internet

* www.NAR.org

* Yellow Pages

The Agent Interview (Checklist)

* Prior experience in Court Related Sales

* List of prior Court Related Sales

*Familiarity with Probate Process

* Expertise with Probate contracts

* Market Area Specialist

* Advertising & Marketing Commitment

* Internet savvy

During the Listing

MLS Verbiage

MLS verbiage at time of listing must include:

a. Probate (or Conservatorship or Trust Sale). Court confirmation required.

b. All offers to be submitted on Probate Deposit Receipt.

c. Commission paid to successful selling agent only.

d. Property sold as-is. Buyer responsible for termite report/completion and all retrofit.

MLS verbiage at time of accepted offer must include:

a. Accepted offer is $__. Minimum overbid is $__. Court date and time to be published once known.

b. Commission paid to successful selling agent only.

c. Property sold "as-is". Buyer responsible for termite report/completion and all retrofit.

Property is to be advertised from time of listing until court confirmation of sale.

Contractual Obligations

* Probate Listing Agreement

* Probate Advisory

* CAR Disclosures

* Real Estate Company's disclosures

The Offer Process

Offers are submitted to the Listing Agent and reviewed prior to presentation to fiduciary

1) Is it written on proper contract and filled out correctly?

2) Is the deposit check made out appropriately?

3) Is there an approval letter from lender if a loan is required or proof of funds if all cash?

4) Is the contract written free of contingencies?

5) Offers should be reviewed by fiduciary's attorney prior to acceptance.

If inspections are being done prior to submission of an offer or prior to court overbidding, buyers must sign a 'Buyer's Inspection Indemnity'.

Escrow may be opened upon acceptance of initial offer so escrow instructions are available to buyer's lender. Any required governmental reports may be ordered at this time and any outstanding title issues should be resolved. No escrow paperwork is signed until court confirmation.

Escrow should review the court order draft to check for errors prior to submission to court.

Closing

Congratulations! You did it!