When Inherited Property Delays a Closing: Why Probate Matters Before You Sell
Many families assume that when a relative passes away, ownership of their property automatically transfers to the heirs. In reality, that is often not the case. Depending on how the title was held, how much time has elapsed, and whether a will exists, formal probate may be required before anyone has the legal authority to sell the property.
Real-World Example: How Unfinished Probate Stopped a Sale
A family believed they had inherited two homes from their grandmother and quickly found a buyer. Inspections were complete, financing was approved, and everyone expected to close within a few weeks.
However, a routine title search revealed a major legal roadblock:
- Co-Ownership: The grandmother had originally purchased the property with her sister.
- Unfinished Estate: When the sister passed away, an estate was opened and the grandmother was appointed administrator, but the probate process was never completed.
- Trapped Title: When the grandmother later passed away, ownership had still never been transferred out of either estate. Legal title was held by two separate estates, not the family members trying to sell.
To move forward, both estates had to be properly administered. The family had to reopen the older estate to appoint a successor administrator for the sister’s estate and then probate the grandmother’s estate to appoint an administrator with authority to sell. Even with full family agreement, this took months. By the time it was resolved, the buyer’s lender had withdrawn loan approval and the deal fell apart. The grandchildren could only convey good marketable title after both probates were completely finished.
Common Estate & Title Traps
Closing delays frequently occur in situations where:
- An estate was never officially opened.
- Probate was started but never completed.
- A previous owner’s estate was overlooked for years.
- Multiple generations passed away without legally transferring title.
- Heirs signed a sales contract before securing the legal authority to sell.
Why Early Title Examinations Matter
These issues often remain hidden until a thorough title examination is completed. One of the most crucial parts of a title search is confirming who legally owns the property, as the answer isn’t always as straightforward as expected.
Catching ownership issues early allows the appropriate steps to be taken well before the scheduled closing date. While some situations require formal probate, alternatives may exist to shorten or simplify the process depending on the circumstances. The sooner these complications are discovered, the better the chances of keeping your real estate transaction on track.
William Jarrett is a real estate closing attorney with Origin Title and Escrow, Inc.. Since 2003, Origin Title has handled real estate transactions – purchases, refinances, reverse mortgages – quickly and professionally. There will be no surprises, nothing misunderstood. Title searches are thorough and well-reasoned, to avoid unpleasant surprises later down the road. Calculate your closing costs in Georgia or Florida using our calculator or contact Origin Title using this form.