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A recorded contract for deed specified a Life Estate w/remainders, is it a probate asset that requires distribution? Please read

Duluth, MN |

In 2012, Mother and non-family buyer signed a MN Contract for deed stipulating a Life Estate for her leaving the remaining interest to my brothers and I. No "due on death clause just buyer to pay monthly payments on time until paid in full, insurance coverage in sellers name, maintenance, on time property taxes. Mother passed away in April this year.

Her will states; I give, devise and bequeath any interest, at the time of my death, in that certain contract for deed entered into on (dated..2012 ) ;with (named buyers) .......recorded in...(Named County).as document..(#) ... to my children (naming us). It then clarifies and legally describes the property.

Without this property as an asset, her estate is worth less than 20,000.00 and very likely does not need to be probated?

Attorney Answers 3

Posted

Probate should not be necessary for the property if you believe your mother intended to give the non-family member a the life estate. If you have issues with that contract, you should meet with a local probate attorney to discuss options.

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Posted

My guess is that the purchaser's interest in a land contract would be considered an asset of the estate. It is possible, depending on how this was structured, that the interest that your mother had terminated upon her death, in which case, there would be nothing to include in probate and equitable title in the property interest would pass to the heirs. This sounds like an unusual arrangement, however, and the documents should be reviewed by a probate attorney to be sure you are proceeding correctly.

The Will provision can only be given effect through probate. A contract provision may take it out of probate, however.

James Frederick

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1 comment

James P. Frederick

James P. Frederick

Posted

Might be the seller's interest, depending on how the summary is interpreted. The practical problem if your mother was the SELLER, is that you would likely need a personal representative appointed in order to transfer title, once the contract is paid off.

Posted

I do think you will need to probate your mother's estate as she was the seller under a contract for deed that has not yet been completed. It is only when the contract is paid in full that the seller supplies equitable title to the buyer via deed. Someone will need authority as personal representative to sign the deed completing the contract. Or, if 3 years has passed since her death, you could obtain a decree of descent for the transfer of the property to the buyers. I would definitely consult a probate attorney regarding same.

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