Probate property is especially appealing to fix-and-flip investors. This is because a probate property is sold as-is, meaning no repairs have been made. The property can offer plenty of potential. You can buy it well below market value, invest funds to fix it up, and then sell it at a competitive price for a profit. It can also be a great project for homeowners who don’t mind fixing up and renovating the home that they live in.
The process of buying probate property varies from state to state. This is because probate laws also vary between states, making the sale process look slightly different across borders.
Probate property being sold directly by the court will be placed for sale through an auction process. The court will typically publish listings on their website. You may be required to submit a bid in advance to attend the auction. If you win, you typically have to pay in cash or by check.
If the property is being sold by the executor, then you’ll work directly with the executor to submit your offer and make negotiations. These properties are typically listed publicly with the help of a real estate agent. The purchase process does not differ too much from the traditional home-buying process. A key difference is that the purchase is contingent upon approval from the probate court, which can take several weeks to go through.
Once you identify a probate property that you’d like to buy, there’s typically two ways to make your purchase. The first is to make your offer to the seller, which hopefully gets accepted. If the seller accepts an offer from a different buyer, you can appear in court to submit a higher bid. You may be competing with several eager buyers, so be prepared to get into a bidding war if you really want the property in question. However, be careful, because if your offer is accepted, you must be able to buy the property under the same terms and conditions set for the original party whose offer was first accepted. You cannot negotiate in hopes of obtaining better terms as you would for a traditional real estate transaction.