So, you’re thinking of buying a house. Whether this is your very first home or an additional property to add to a portfolio, it is an incredibly exciting time. Estate probate insurance is one of the most important things you can ensure you cover when buying a property and can often be forgotten about.
With the last year tragically leading to increasing numbers of probate properties on the market, we take a look at everything you need to know about buying or selling a probate property.
What Is Probate?
In a nutshell, probate is the process of dealing with the estate of someone who has died. This could be equity, possessions, and, most commonly, property. When someone sadly passes away, even if they have been clear in their will to benefit from their estate, this doesn’t automatically mean the beneficiary can do whatever they want with these inherited items.
Selling A Probate Property
The beneficiaries need to apply for a Grant of Probate; this document states they are now the estate’s legal owner. If there are multiple beneficiaries, then multiple grants will need to be issued.
This process can now be done fully online, and the turnaround time takes just a few weeks, sometimes less. Without this document, beneficiaries have no legal right to sell a property, and no reputable solicitor will be willing to represent you until this is obtained.
However, that doesn’t mean the ball can’t start rolling. When placing a probate property on the market, there are a few things you need to ensure in place.
Should a fast offer come along, most probate sellers want to complete the transaction as soon as possible. For many, it is that final piece to help let go of losing their loved one.
Unfortunately, selling a property that you didn’t live in, or perhaps have not lived in for a long time, can be difficult.
Not only does Grant of Probate need to be obtained, but you need to collate all other documentation and information that the deceased would previously have provided should they be selling.
This could be anything from knowing the location of the stopcock, being aware of who supplies gas, electricity, and broadband. Physical documents such as boiler guarantees and FENSA certificates will need to be provided. It can be tempting to empty the property as soon as possible but making sure you have these items first and keeping them safe can save a world of trouble later on.
However, the most important thing any probate seller needs to do is get covered with probate and wills insurance. When dealing with estate probate administration, even the most seemingly clear wills or agreements between beneficiaries could be challenged.
This could be from the discovery of a new will, the reappearance of a missing beneficiary, or simply anyone who believes they are entitled to the estate. While these challenges are rare, they can be catastrophic to beneficiaries and the buyer of the property.
By covering yourself with probate insurance, you can be financially covered should the worst happen. Many probate insurance policies also offer home insurance, but make sure you double-check this.
As the beneficiary of the property, you are responsible for the home and contents insurance. Without this, you could face dire consequences should anything happen, such as fire, flood, or burglary. If the property is empty for more than 30 days, make sure you take out an extra unoccupied property insurance policy.
Buying A Probate Property
The first thing a buyer and solicitor should check is if the seller has taken out probate insurance. It isn’t just the seller who is at risk from other claimants. Depending on where you are in the conveyancing process, you may have already invested a lot of time, money, and emotions into this property.
If a claimant to the property is successful and doesn’t wish to proceed with the transaction, probate insurance will cover you for lost cash and even compensate you.
But there are some responsibilities of the buyer when it comes to probate. While surveys and searches will shed some basic information on the property, a lot relies on the seller.
The seller most likely doesn’t know the property and the deceased and may guess, estimate or even lie to get the sale pushed as quickly as possible. Take the time and invest the money in extra surveys, not just the basic mandatory ones. This includes boiler and roof surveys.
Before exchanging contracts, ask your conveyancer to ensure the seller will be transferring the probate insurance into their name. Don’t worry; you won’t have to pay anything as these policies are typically one upfront cost, but you want to make sure you are covered should anything come up in the future.