Buying property out of probate

Buying property out of probate

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constellation

Original Poster:

15 posts

136 months

Tuesday 31st March 2015
quotequote all
I'm looking to buy a property from a deceased's estate (which I believe has two beneficiaries), and the solicitor acting as executor to the deceased has said the property has been valued at a certain amount for probate (call it £100,000 for ease of this situation).

As a prospective buyer am I obliged to put in an offer above 100,000? Or is the probate valuation just something to put before the Probate Office/Register so they can establish how much tax / IHT is due?

Thanks

Simpo Two

85,150 posts

264 months

Tuesday 31st March 2015
quotequote all
The latter. Probate valuations try to be low, for obvious reasons, so the property may be worth more anyway.

nitrodave

1,262 posts

137 months

Tuesday 31st March 2015
quotequote all
Who are you dealing with in all of this? An estate agent or is it a private sale?

I am an executor and just sold a house whilst waiting for our grant of probate. We valued it at £590k for the IHT forms and to get probate granted. We put it on the market with an estate agent and actually sold it for £670k.

The amount we valued it at was a low ball figure just for the IHT forms and meant we would owe HMRC money rather than us having to chase them for a refund.

Disregard the probate sum and offer what you think it is worth.

constellation

Original Poster:

15 posts

136 months

Tuesday 31st March 2015
quotequote all
Great stuff, thanks chaps.

konark

1,089 posts

118 months

Wednesday 1st April 2015
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A probate value should be the market value of the house on the day the person died.
There is no need to get a surveyor involved so many people just go by the price of similar houses, or get an estimate from an estate agent.
You may think people would want to put in a smaller figure than the house was worth but unless you are into IHT territory (£325k+)this can be a serious mistake. Probate fees are the same whether the house is valued at £20k or £200. If the benefactors sell a house for substantially more than probate value they will be liable for CGT on the excess, unless they actually live in the house.

In essence, the probate value should be the market price.

aw51 121565

4,771 posts

232 months

Tuesday 7th April 2015
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Probate can also be applied for by an individual, with no solicitor involvement or legal advice at all wink . As an aside, there may be a perceived "need" to keep the value of the estate below the IHT threshold, but even so... Most people are honest.

My wife passed away last June; she died intestate and I applied for Grant of Administration as her Widower and Next of Kin with no issues whatsoever smile . As such there was no IHT limit - and the process was easy (took me 13 weeks, it wasn't a complicated estate).

And (ref: a post upthread) property within an estate subject to Grant of Probate (or Administration) CANNOT be sold - it is legally "frozen" as are the deceased's bank accounts and other affairs etc - until Probate has been granted (ditto Grant of Administration).

Selling before Grant of Probate/Administration could be classed as "playing things fast and loose" (shall we say?) hehe .