My parent owned a house since 1978, and they both passed away, the house worth $400,000 now because it looks bad overall but the house already paid off, and in according with will said it is going to split 50/50 between me and my brother, we assigned a lawyer as the administrator for the probate process on last November, 2016, my brother told the probate lawyer the wrong house value amount 500,000 instead of 400,000, he got the wrong price form internet, it just over price the house about 100,000 so I having the following questions :
1. Can we ask the probate lawyer to transfer the house title to me and my brother during the probate process?
2. If yes on question # 1, after the title transferred, if I want to take over the whole house, in other words, want to buy my brother share, I heard some people said I need to pay to my brother the amount allowed by the probate court, what is exactly means on " the amount allowed by the probate court " ?
3. Can the probate lawyer just transfer house to me directly during the probate process and pay to my brother next year ?
4. Does the law allow me just to pay half of 400,000 to my brother, instead of half of 500,000?
If you and your brother are the only heirs, you can agree together on what you will pay your brother for his interest in the home, and what the terms of payment would be. You need to know that if the home is transferred half to each of you, and AFTER the transfer you buy your brother out, half the value of the home will be re-appraised. So that if, for example, your parents' tax base was frozen at a value of $200,000, with taxes of about $2,000/year, now your half would still be appraised at $100,000, but the other half would be at half of current market value (let's say half of $400,000 if your value is right). So taxes would now be $3,000 instead of $2,000. Depending on the terms of the will, there can be options that your probate attorney should evaluate on how the whole house could potentially be transferred to you, with your brother receiving a note (loan payable to him) on his half. Your brother does not have to agree to this, and he might not agree to it, especially if you don't have money to buy out his half right away.
Regarding the probate referee's appraisal: They just do a drive-by and look for comps in the neighborhood. If you have pictures of the inside being a mess, or information that the roof is really old, etc., you could give him that information and see if he will lower the value he listed.
There is no right or wrong answer to your question but there is no doubt you will be best served by getting your own attorney who represents your interests. The probate attorney represents the estate. First, the probate referee will assign a date of death value to the house. If the death was within 6 months, that value can be adopted as the actual market value. If it has been more than 6 months, you will need to get an appraisal. That appraisal will determine what you may owe your brother if you want to buy him out. That is all subject to negotiation however, and that is where a good attorney can save you some mone. With regard to transferring the property, that cannot be done until the probate is finalized by court order, but the administrator can negotiate a sale to you during probate if all parties agree and the proper notices are given. Again, this can be done but you really need an attorney to make sure it is done properly.
1. To avoid property tax increase, you need to receive title from the estate. From what you have said, the estate will have to get a loan secured by the home so that you get the home and your brother gets cash equal to the equity in the home.
2. There is a process for partial distribution, BUT, the court does not like to do that unless there is a delay in the probate process and there is a real reason for the delay. e.g. Thge estate needs to be kept open to receive an inheritance from Uncle Joe. You will have to wait until the end of probate to receive title. BUT, the loan needs to be in place before the end of probate.
3. Not without court permission, which is unlikely.
4 The value given on the petition is an estimate. The value given by the Probate Referee should be the market value on the date of death.
When the person gives you money, the person has an attorney and the attorney has a client, but not until then. Inspired by words of Abraham Lincoln
Your probate attorney is obligated to attain the court appointed third party probate referee’s opinion of value to determine the value of the house at the time of death. This is an independent third party that determines the value of the estate. Generally, when an heir wants to purchase the house from the estate I allow a discount of 5% since the estate will save the real estate broker’s fee. In addition, if you accept the transfer of the property during the estate you run the risk of a property tax increase for your brother’s half of the property. However, if it is transferred by final Court order there is no increase. It is a risk you take. You can also list the house on the market and have the right to first refusal to purchase at the highest offer. That is a fairer way for your brother. Your attorney sounds like he is doing everything correctly so I encourage to go and speak to him.
I respond to your specific questions as follows:
1. Yes, but the Court will need to approve any distributions.
2. Your brother is entitled to his share. If the property is distributed to both, then you can work out whatever payment arrangements you want. There are tax advantages, however, to you "buying him out" during the probate if it can be accomplished.
3. No. All distributions have to be Court supervised and approved.
4. Your brother is entitled to his fair share of the asset, including any increase in value of the asset. If your brother will agree to accept less (the original value), then great. But the law doesn't allow you to force him to take less.
Although these matters seem simple in concept, the devil is in the details. Seek legal counsel to do it once and do it right.
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