Probate & Real Estate Attorneys in Austin, Texas
Real estate is often the most valuable asset in a decedent’s estate. Before it can be distributed or sold, however, there are often title issues and legal obstacles that must be resolved.
With dual experience in real estate and probate, our attorneys counsel heirs, beneficiaries, and fiduciaries in the sale, financing, distribution, partition and exchange of real estate during estate and trust administration.
Common Methods Of Clearing Title To Real Estate In Texas
Probating The Will:
Did the deceased property owner have a Will? If so, you may need to Probate the Will. A Texas will is not effective to prove title to real property until the will is admitted to probate. The purpose of probating a will is to give legal effect to the decedent’s last will and testament by transferring title to all property owned by the decedent at the time of his or her death to the intended beneficiaries.
Say for example your grandmother passes. In her Will, she left her house to you and your two siblings. You and your siblings want to sell the house soon and have already found an interested buyer. Who is allowed to sell the house? The executor of the Will, most likely. If the Will gives the executor the authority to sell property without restriction, then the executor is the one who Will be conducting the sale. However, before the executor named in the Will has the authority to sell the house, the Will must first be admitted to probate and he or she must be appointed executor by a judge. The executor named in the Will has no authority until appointed by the judge.
Affidavits Of Heirship
Affidavits of heirship are a way to clear title to real estate and avoid expensive and time-consuming heirship proceedings in probate court. If the deceased property owned died without a Will, and there is no need for an estate administration, and the decedent’s only asset of any value is a house or other real property, then affidavits of heirship may be an effective solution.
An affidavit of heirship a legal document that attests to the deceased’s family background and heirs. This affidavit gets filed in the real property records and serves as a link in the chain of title. You will usually need one affidavit for each deceased person in the chain of title. For example, if the property was owned by two parents who are now deceased and left no wills, affidavits would be needed for each.
The benefits of affidavits of heirship is that they are quicker and more cost-effective than formal probate proceedings. However, some transactions may be too complex for an affidavit of heirship and may instead require a judicial determination of heirship in probate court.
Many title companies in Texas are very particular about affidavits of heirship. Each title company may have its own policies as to when it will accept an affidavit. Some title companies, for example, will not accept an affidavit of heirship unless the decedent has been deceased for at least one year. Affidavits of heirship typically cannot be used when there are unpaid debts owing to the estate of the deceased.
Consider the following situations in which affidavits of heirship might be used:
Jane Smith wants to sell her house. The title company commitment shows John Doe in title. Jane says “oh, that’s my grandfather. He died 20 years ago.” Title company says she is not in title. Even though Jane has paid the taxes every year, the tax bill is in her name, and the utility bills are in her name, she is not in title from a title company’s perspective. An affidavit of heirship could be utilized to complete the chain of title from Jane to her grandfather.
While affidavits of heirship are effective for transferring title of real estate, they are ineffective for other estate property such as bank accounts or business interests. In such cases, a probate administration and determination of heirship may be necessary.
Determination of Heirship
A determination of heirship is a probate proceeding where a judge legally declares the heirs of the deceased. When someone dies without a Will, by law the property passes to the deceased’s heirs. You may know who the heirs are, but third parties won’t take your word for it without some legal proof from a court–banks, title companies and financial institutions will want to see a judgment declaring you are an heir and thus entitled to sell the deceased’s property.
Determinations of heirship are usually used when the decedent died without a will. Sometimes, however, a determination of heirship is necessary even with a Will. For instance, if a Will results in a partial intestacy (i.e., the Will does not dispose of all of the deceased’s property), a determination of heirship may be necessary.
Consider the following example. Joe leaves a handwritten Will on a napkin. The Will simply reads, “I give my acreage in Bastrop to my son; and I give my house at 123 Main Street to my daughter.” Joe dies. Not mentioned in the Will are his bank accounts or his fishing camp in Port O’Connor. This results in a partial intestacy. In addition to probating the Will, a determination of heirship would be necessary.
Texas Muniment Of Title
This procedure is used when the decedent left a will, but decedent’s final affairs have been already been wrapped up such that there is no need to appoint an executor of the Will to administer the estate. In other words, the Will is being offered to probate only as proof of title. A muniment of title proceeding is basically a probate minus the appointment of an executor/administrator.
Muniment of title proceedings are often utilized if more than four years have lapsed since the date of the decedent’s death. There is a four-year time limit to probate a Will in Texas after the deceased has died. After the four-year time period has passed, the deceased is presumed to have died intestate (i.e., without a Will), unless the Will is admitted to probate as a muniment of title. After the four years, it is much more difficult, and sometimes impossible, to admit the Will to probate.
Situations where muniments of title are used when there is no need for probate but the beneficiary of real property under the will is not an heir-at-law. Consider the following scenario: Jane Smith dies. Her affairs have been wound up so there is no need for administration. She left her IRA to her children. She had a Will which left her house to her friend, Mark. If an affidavit of heirship was used, then only Jane’s heir-at-law (i.e., her children) would be entitled to her house. The Will could to be offered for probate as a muniment of title to fulfill the devise to Mark.
Types Of Estate Administration (Independent/Dependent)
There are two kinds of estate administration in Texas: independent administration and dependent administration. The method and manner of selling estate property will differ greatly depending on which type of administration exists. Independent administration of an estate allows an executor (if there is a Will), or administrator (if there is no Will) to administer the estate and sell estate property without direct court supervision.
A dependent administration, on the other hand, is court-supervised. Every action by the executor or administrator must be approved by the judge, including the sale of real estate. Even if the dependent administrator has been granted Letters of Administration, these Letters are not sufficient authority to sell real property of the estate. Such letters will allow the executor / administrator to contract for the sale of real property, but the sale will ultimately require the approval of a judge.
It can take a long time to sell property in a dependent administration, often as long as four months. Sale of property in an independent administration is generally faster—sales can happen once the executor or administrator has been appointed and granted Letters.
What Happens To A House When The Owner Dies?
What happens to a property when the owner dies is a fact-specific inquiry. The answer depends on a couple of factors, including how the property is titled during the owner’s lifetime, whether the home is community or separate property, and whether the owner has an estate plan. Here are some examples of how a house could pass at death:
1. I Am The Sole Owner Of My House
Say you are the sole owner of your house. What does it mean to be the sole owner? Sole ownership of property simply means that it is owned by one person in his or her individual name (there is no shared community interest) and without any transfer on death designation. If I am the sole owner, what happens to my house when I die? Well, do you have a Last Will and Testament? If so, your Will dictates who inherits the property. If you die without a Will, your house will pass to your heirs as determined by the Texas Estates Code.
2. I Am Married And Own The House With My Spouse
If you are married and own the house as community property with your spouse, spouses are free to leave their half-interest in the community property to whomever they choose; generally, if they don’t name a different beneficiary in their Will, it passes to the surviving spouse under the laws of intestacy.
3. I Own The House With A Friend Or Relative
Each co-owner can name a beneficiary in his or her will; or if there’s no will, the deceased co- owner’s interest in the property passes under state law to the closest relatives. Probate will often be necessary to transfer the interest in the property. If you co-own your home with someone and you die, your share of the ownership interest passes according to your Will or goes to your heirs if you die without a Will.
4. My House Is Held In A Trust
Another common type of home ownership is ownership by a trust. If title to your residence has been transferred to a trust during your life, the trustee of your trust owns the house and the terms of the trust determine what happens to the house at your death.
5. I Have A Transfer On Death Deed
A Transfer on Death Deed is a type of deed that has a beneficiary named to receive the property after the owner dies. With a proper transfer on death deed, real estate can pass outside of probate upon the death of the owner. Your house can pass outside of probate if you execute a Transfer on Death Deed or Lady Bird Deed. For instance, if you own a home and want it to go to your son when you die, you could execute a Transfer on Death Deed naming him as the beneficiary who will automatically take title to the house upon your death.
Contact Our Texas Probate And Real Estate Attorneys Today
If you need legal assistance with resolving title issues after a property owner has died, contact the Daves Law Firm to speak with one of our attorneys.