What Executors Need to Know about Real Estate in Probate

Being an executor of an estate is a huge responsibility. Executors protect the assets of an estate, ensure outstanding debts and taxes are settled, and distribute property to beneficiaries according to the wishes of the deceased. Most people nominate an executor in their will. This is typically a child, spouse, sibling, close friend, or even a personal attorney. If an executor is not assigned in the will, the duty will pass to a court-appointed administrator.

An executor is responsible for taking an inventory of the decedent’s assets. This inventory will include a full accounting of any real estate owned by the estate, including the primary residence, secondary properties or vacation homes, and investment properties. Processing real estate through probate can be complex and time-consuming. Understanding the probate process and the responsibilities of the executor can help you be a more effective executor.

Here are five responsibilities executors have for real estate in probate:

1. Secure and Maintain the Property

Once the owner of the property has died, it is the executor’s responsibility to secure the home. This can involve changing the locks if needed, ensuring insurance coverage is maintained, paying property taxes, and performing regular maintenance to keep the property's value. Utilities, mortgage payments, and other homeowner expenses will also be managed by the executor.'

2. Identify Ownership

It is crucial to identify the type of ownership of each property owned by the estate being settled. The type of ownership (sole ownership, joint tenancy, tenancy in common, etc.) will determine whether the property must pass through probate. If the deceased was the sole owner of the real estate and did not have a trust or some other estate planning tools in place, the executor will need to proceed with probate.

3. Get an Appraisal

Once you confirm that the property must pass through the NJ probate process, you can move forward in the probate process by getting the property appraised. Because real estate values are always fluctuating, an appraisal will likely be necessary to determine the home's fair market value for sale and tax purposes. The appraisal must be conducted by a professional assessor who can determine the property's value as of the date of death.

4. Settle Liens and Debts

If the estate lacks the funds to cover all debts, the executor will need to sell the property to settle them. Selling the home at its appraised fair market value will help the executor pay debts, mortgages, taxes, or any liens against the property. Whatever is left after all debts are settled can be distributed to the estate's designated heirs.

5. Sell or Transfer Property

The executor will follow the decree of the will to either sell the property or transfer ownership to the listed heir of the property.

If the will dictates a sale, the executor will be responsible for listing the property, working with a real estate attorney, and going through the closing process for the home. It is possible the executor will need to obtain court approval to sell the property. To do this, the executor will petition the court for permission to sell the property. The court will ask the executor to explain why the sale is in the best interests of the estate and its beneficiaries. It is also in the best interest of the executor to work with real estate professionals who understand the probate process.

If the property is intended to pass to heirs, the executor will need to ensure a new deed is prepared and recorded. In the event the property is passed to an heir, the executor will also be responsible for determining if state or federal taxes will be owed for the transfer of the property. The executor will work with the heirs to determine the next best steps for the property, including selling the property to divide the proceeds evenly amongst the heirs, transferring ownership (and determining the best type of ownership), or establishing a trust to manage the property on behalf of the beneficiaries.

Is there a way to bypass the probate process in New Jersey?

Yes! Working with an experienced NJ estate planning attorney can help you set up your estate in a way that avoids the probate process as much as possible. Different estate planning solutions can help you ensure that your wishes are carried out after you are gone. This can also help the executor of your estate settle your affairs quickly and painlessly.



Veitengruber Law is a real estate and estate planning attorney and law firm with in-depth knowledge of the NJ probate process. We can help you find effective solutions to avoid your assets going to probate. We also work with executors as they navigate the probate process.