What You Need to Know about an Underwater House and the Probate Process
Transcript:
Hi, my name is Jordan Flake. I’m an attorney in Henderson, Nevada. I do a lot of probate work which means when an individual passes away and there’s property in that person’s name still, there needs to be a court legal declaration as to where that property goes and how it’s handled. One really common scenario especially since the economy went down a few years ago is that Jane Smith will pass away, she’ll have a house in her own name, the house is worth $80,000; however, the mortgage is $94,000. A lot of times family members will just say, “Well, the house is underwater so we don’t need to worry about it. We don’t need to do anything with it. Nobody’s going to take responsibility for it.” The idea is that it can’t be probated.
That’s not correct. It is true that the liability won’t come and haunt her heirs so the children of Jane Smith don’t have to worry that the $14,000 that represents the underwater amount, that’s not going to come back, chase them down, but what you should know is that you actually can do a probate for that property and short sell the property and oftentimes get paid out of the proceeds of the sale, at least an administrator’s fees, the legal fees can be paid out of the proceeds of the sale, the realtor’s fees can be paid out of the proceeds of the sale, and the property is, and this is maybe the best thing, is that the property is actually resolved rather than sitting there empty for years and years and years, you actually tie it up. It doesn’t cost you anything and oftentimes we can get you paid an administrator’s fee for the work of having dealt with an attorney and a real estate agent to sell that.
Real estate tip of the day is if you come across a house where it’s underwater and it’s owned by a deceased individual, reach out to Clear Counsel Law Group, contact me, we’ll do a free consultation, and we’ll discuss our options for doing a short sale on that property by opening up a probate. Reach out to me if you’d like to discuss this more. Jordan Flake at Clear Counsel Law Group. Thank you.
