Probate real estate investment involves the purchase of property from probate estates. Probate is the process used to inventory and distribute property belonging to someone who has died. Depending on the complexity of the estate, the probate process can take between six months and three years. During this time, the estate is responsible for maintaining the property and paying mortgage payments, utilities, and insurance.

Probate real estate investing provides an opportunity for property managers to sell real estate. This is particularly beneficial for servicers who are having difficulty paying mortgage payments or keeping property in probate.

The first step of investing in probate real estate requires a visit to the local courthouse where probate matters are handled. When an estate is placed in probate, it becomes a matter of public record. Most of the information about the estate can be found in the Last Will and Testament of the deceased. Typically, the will names the executor and describes how the decedent wishes his or her personal belongings and financial assets to be distributed.

If the decedent dies without executing a will (intestate), the probate records will indicate who has been assigned to administer the estate. Generally, this is a direct lineage relative. However, if the decedent has no living relatives or no one accepts the position of administrator of the estate, the probate court assigns a third party to administer the estate.

Once the trustee’s contact information is located, the next step requires a search of deed records to locate real property in the decedent’s name. Deed records record ownership and transactions of land. When real estate is transferred or sold, a new deed is recorded. Deed records reveal whether the property has a mortgage. If so, the estate is required to maintain the payments throughout the duration of the probate.

If the property has a second mortgage against it, the heirs will likely need to sell the property to pay off any outstanding balances. The estate administrator is authorized to make decisions regarding the sale. However, if there are multiple heirs, all must agree to sell the real estate that is in probate. In some cases, the estate may require permission from the probate judge to sell real estate.

When compiling a list of possible estate probate agreements, investors should contact the executor of the estate. This can be done by phone, mail, or in person. When contacting the estate manager, it is imperative that investors be respectful and offer their sincere condolences.

Most estate administrators and beneficiaries are unaware that they can liquidate real estate during the probate process. Offering to buy your property could solve your financial problems and give investors instant equity in their investment. Real estate can often be purchased for well below market value when heirs need immediate cash.

Probate real estate investing does not require special training. However, investors who commit to buying probate property must possess strong communication and negotiation skills, along with a sense of compassion.

Investing in probate real estate offers multiple opportunities for profitable deals. While it requires a bit of detective work and negotiation with distraught and grieving heirs, when done correctly, real estate deals provide a win-win situation for all parties involved.