The sale of probate real estate under IAEA is part of the probate process.
Probate is the legal process to administer a deceased person's estate.
The legal process is managed by the probate court in the county where the deceased person resides. Among other things, the process involves:
- Determining if there is a will and if it is valid
- The heirs and/or beneficiaries
- Value of the estate
- Managing the financial responsibilities of the decedent
- Distributing or transferring assets to heirs and/or beneficiaries
What is IAEA?
The California Probate Code governs the Independent Administration of Estates Act also referred to as IAEA.
The laws allow an administrator or executor to manage most aspects of an estate without court supervision.
When does the authority to act under the IAEA get granted?
- Authority may be granted by petition to the court or given in the will
- If the will prohibits IAEA, or if an interested party provides good cause to the court for why an estate should not be administered under IAEA, the estate cannot be administered under IAEA.
Powers get granted when the judge grants "Letters". Administration of the estate begins after the Letters get issued by the court. Letters Testamentary are issued if there is a will. Letters of Administration are issued if there is no will.
Letters of Administration grant the level of authority and if a bond is required.
Full Authority versus Limited Authority
Under full authority, the executor or administrator may, at their discretion, sell real property, and grant an option to purchase, exchange, or borrow money with a loan secured by the real property.
Under limited authority, the personal representative has the power the act under IAEA except:
- The power to sell, exchange, or grant an option to purchase or borrow money with a loan secured by a loan on the real property.
If the Will prohibits IAEA, then neither authority gets granted by the court.
Selling a Probate Home Under IAEA
Does the IAEA govern the price and terms of a probate home?
- Under full authority, the price and terms of the sale of real property are determined by the executor or administrator.
- The sale is not subject to court supervision or overbidding.
- Among the fiduciary duties of the estate representative is to maximize the estate’s assets.
The law that requires the price to be at least 90 percent of the appraised value does not apply under full authority.
In the video below, probate and trust attorney Jennifer F. Scharre discusses the advantages of administering a California probate estate with the power to sell real property without the court’s permission.
Certified Probate Real Estate Specialist
Kathleen Daniels is a California Real Estate Broker specializing in probate real estate. She is a Certified Probate Real Estate Specialist, also referred to as CPRES, and/or probate real estate agent.
She works exclusively with estate representatives (Sellers) listing probate homes for sale. Most of the homes she lists for sale are with full authority under the IAEA.
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