Last updated on 09/04/2024
A house is most people’s most valuable investment and the primary means of passing wealth from one generation to the next. When the sole owner of a house dies, they have often been widowed for some time and may have failed their will or trust to ensure they can pass their property on to their intended heirs. Sometimes they have updated estate planning documents under the improper influence of third parties or without fully understanding their actions.
What happens to a house when the owner dies in California largely depends on the terms of the decedent’s will or, if there is no will or trust, the state’s intestate succession laws. In many cases, a house is sold after a sole owner dies to raise money to pay the estate’s bills and/or to more easily divide the home’s value among multiple heirs.
If you believe you have a claim on a house in probate and/or that ownership of a recently deceased family member’s home is not being handled correctly, the experienced trust and will inheritance lawyers of Albertson & Davidson, LLP are here to help. We have extensive experience navigating sensitive situations and successfully securing the satisfactory outcomes our clients deserve.
Contact us now to set up a complimentary case evaluation with our team.
Home Ownership Must Pass Upon a Sole Owner’s Death
A deceased person can’t own real estate. Therefore, if one person owns a home and dies, ownership of the house will likely pass to one or more heirs as identified in the decedent’s will or by state law.
When an individual dies, their estate typically passes into probate, the court-supervised procedure for paying the debts and distributing the assets of a deceased person. If the decedent left a will, it will name an executor to administer the estate and distribute its assets. If the decedent did not leave a will, a probate court judge will appoint an administrator to distribute the decedent’s property as required by law.
How Home Ownership May Be Transferred with a Will
The best scenario is that the decedent left a will that states exactly what they wanted to be done with their home upon their death. In most cases, the probate court will follow the terms of a will without question.
Often, a married couple prepares separate wills that bequeath the other spouse their half-ownership of their home upon their death. The will may also describe how ownership of the house should be transferred if they survive their spouse as the sole owner of the home.
In many cases, if a couple has multiple children, they will leave instructions for the home to be sold and the proceeds divided among the surviving children. The will may also provide an opportunity for one or more beneficiaries to buy out the others’ interest in the home and assume ownership.
It is also possible for a sole homeowner to bequeath title to the home to a single person or entity. If additional heirs might have received the home, one would hope the will makes other provisions of like or similar value for them.
How Home Ownership May Be Transferred Without a Will
If the decedent did not leave a valid will, the administrator appointed by the court must distribute property owned by the estate according to California’s intestate succession law. Under the law, surviving family members are legal heirs of the estate in the following order:
- Surviving spouse
- Children and grandchildren
- Parents
- Siblings
- Grandparents
- Children and grandchildren of decedent’s grandparents (decedent’s aunts, uncles, cousins, nieces, and nephews)
- More distant relatives
Intestate succession can get complex. If the decedent’s relatives in one category survive as heirs, relatives in the descending categories do not receive anything. For example, if the decedent’s children survive, the decedent’s parents would not inherit anything. A house owned by the decedent (as a widow or widower) would go to the children.
In other cases, intestate succession allows people in lower categories to inherit property. For example, if a spouse and parents survive but there are no children, the spouse and parents would each receive one-half of the decedent’s property, including a house held solely in the decedent’s name.
Can the Executor of the Will Sell My Parents’ Home?
The executor named in a will assumes authority over the administration of the deceased’s estate. They are tasked with completing the following tasks:
- Identify and gather assets of the estate
- Pay the estate’s debts and expenses, including taxes
- Identify and notify named beneficiaries of the will
- Distribute the remainder of the estate to legal beneficiaries
- Provide the probate court with a full accounting of how they settled the affairs of the estate
California’s Independent Administration of Estates Act (IAEA) grants an executor or appointed administrator the authority to administer most matters regarding the estate without court supervision. When the court appoints an executor or administrator, the court may grant them “full authority” or “limited authority” under the IAEA.
An executor or administrator with full authority can sell the decedent’s real estate without consulting beneficiaries of the estate and without court approval. An executor with limited authority must obtain the court’s permission to sell the estate’s real property, but they can get it and make the sale if they show a reason to do so.
An executor or administrator might sell a home to raise money to pay debts or to make it easier to equally divide the estate among multiple heirs or for another valid reason.
It is better for an executor to promptly advise beneficiaries of the need to sell the decedent’s home. Even with full authority, the executor must file a Notice of Proposed Action with the court 15 days before acting and must provide copies of the Notice of Proposed Action to beneficiaries of the will to give them an opportunity to contest the action.
Selling a Decedent’s Home When the Estate is Owned by a Trust
Many couples or individuals establish trusts to hold their assets so they may eventually be distributed according to the wishes of the last surviving grantor.
As a trustee, an individual manages the trust’s assets for the benefit of the beneficiaries. But the trustee does not own the trust’s assets, such as a house deeded to the trust. Technically, the trust owns property transferred to it.
Therefore, assets held by the trust do not go through probate upon a trustee’s death. Instead, one or more successor trustees take over the administration of the trust, including following instructions in the trust’s bylaws. The bylaws may include directions to sell or transfer the title of the house upon the surviving grantor’s death.
Under an irrevocable trust, a trustee who wants to sell a house held by the trust can sell it as long as the proceeds from the sale remain in the trust. Some irrevocable trust agreements require the consent of the trustee and all of the beneficiaries, or at least the consent of all the beneficiaries.
Challenging the Disposition of a House When Its Sole Owner Dies
If you are an heir or beneficiary, you have the right to challenge a will or trust if you suspect fraud or undue influence in creating or revising will or trust documents. You may also request a hearing if there are questions about the deceased’s intentions for the sale or transfer of their home or if there are conflicts over who should be considered a legal heir to the estate.
As a beneficiary of the estate, you have a right to demand the administrator account for their actions and ask the court to instruct or replace an administrator who is acting inappropriately.
Contesting a will or trust requires strong evidence and is not an easy task. But sometimes, a challenge to a will or trust is your only option for standing up for your rights and recovering the inheritance you are due.
Mortgage Foreclosure and Inheritance Challenges
If a home has a mortgage when its sole owner passes away, the mortgage still needs to be repaid. In cases where the mortgage balance exceeds the home’s value, heirs may face the difficult decision to allow the lender to foreclose on the property. This option becomes relevant when there isn’t enough equity to make a sale profitable or manageable for the heirs. Understanding your options, including the potential for foreclosure, can be crucial during the probate process.
Court-Appointed Administrator for Intestate Estates
When a homeowner dies without leaving a valid will, the probate court appoints an administrator to manage the estate. This administrator is responsible for handling debts and distributing assets according to California’s intestate succession laws. Relatives or other potential heirs have the right to monitor the administrator’s actions, ensuring proper management of the estate. If any disputes arise, legal avenues exist to challenge how the estate is being handled.
Spousal Inheritance Without Children
In cases where a sole homeowner dies without a will and leaves behind no children, the surviving spouse usually inherits the entire property. If there are no children, but distant relatives, such as parents or siblings, survive, they may share in the estate alongside the spouse. California’s intestate succession laws prioritize the spouse but also make provisions for certain family members, depending on the circumstances.
Trust Bylaws and Mortgage Responsibilities
For homes held in a revocable or irrevocable trust, the trust’s bylaws dictate how both the property and any mortgage are handled. The trustee may need to sell the property or transfer the title to a beneficiary, while ensuring any mortgage obligations are satisfied. Trusts often provide clear guidelines, but navigating these instructions can still require careful consideration, especially in cases involving outstanding mortgages.
Contact Our Experienced California Will and Trust Litigation Lawyers
If you have recently lost a loved one and are surprised or disturbed by what their will says or the rules of a trust allow, you should speak to a qualified attorney about your legal options. The aggressive lawyers at Albertson & Davidson fight beneficiary abuse by filing trust and will contests throughout California. If you have questions about the terms of a trust or will of which you are a beneficiary, contact us today for a free initial consultation.
Albertson & Davidson has offices in Los Angeles, Bay Area, Orange County, and Silicon Valley. Contact us online or at (800) 601-0170. We stand. We fight. We win.
