Selling Real Estate in Probate: What Arkansas Families Need to Know

When a loved one passes away, one of the biggest questions families face is what happens to the home or other real estate they owned. Understanding the process can help you avoid delays and costly mistakes, and is useful knowledge for heirs, executors, and estate administrators. This article explains that process.

How Do I Sell Real Estate or Property After My Loved One Dies?

In Arkansas, real estate owned solely by a deceased person may need to pass through probate before it can be transferred or sold. The probate court appoints a personal representative (sometimes called an executor or administrator) to manage the estate and handle its assets.

In many cases, the personal representative must petition the court for authority to sell the property. Arkansas law allows estate property to be sold when necessary to pay debts, preserve estate assets, make distributions to heirs, or otherwise serve the best interests of the estate. See Arkansas Code § 28-51-103 and § 28-51-301. The court may then authorize the sale and set the terms under which it can occur.

Before a sale is approved, the property typically must be valued by a qualified appraiser, licensed real estate agent, broker, or other real estate professional. Arkansas Code § 28-51-302. Once the sale is completed, the personal representative must report the transaction to the court for confirmation. Arkansas Code § 28-51-305.

Because every estate is different, the exact process can vary depending on whether there is a valid will, whether multiple heirs are involved, and whether creditor claims exist against the estate.

Can I Sell Real Estate During Probate?

Yes. In many situations, real estate can be sold before probate is completed. However, the sale generally cannot proceed until the personal representative has the proper authority from the probate court.

Arkansas law specifically permits a personal representative to seek court approval to sell real estate belonging to the estate. The court may authorize a public auction or a private sale, depending on what is in the estate's best interests. Arkansas Code § 28-51-301 and § 28-51-303.

Many probate sales occur while the estate remains open. The proceeds from the sale are then held by the estate and used to pay debts, expenses, taxes, and distributions to beneficiaries as directed by the court.

Attempting to sell property before obtaining the necessary authority can create title issues and may delay the probate process. If you are serving as a personal representative, it is important to ensure all probate requirements are satisfied before listing or transferring the property.

What Happens If Somebody Dies With a Mortgage on Their Home?

A mortgage does not automatically disappear when a homeowner dies.

Instead, the mortgage remains attached to the property as a lien. The estate or the person who inherits the property generally remains responsible for addressing the mortgage balance. Mortgage payments often must continue during probate to prevent foreclosure.

Depending on the circumstances, several outcomes are possible:

• The estate may continue making mortgage payments until the property is sold.

• The property may be sold during probate, with the mortgage paid from the sale proceeds.

• An heir who inherits the property may assume responsibility for future payments.

• If payments are not made, the lender may eventually pursue foreclosure remedies.

Whether keeping or selling the property makes the most financial sense often depends on the home's equity, the estate's debts, and the wishes of the beneficiaries.

Need Help Selling Inherited Property?

If you are the benefiary or heir to an estate containing real estate, our firm can assist you with the probate process and the sale of that property. AR Law Partners' attorneys assist Arkansas families with probate administration, estate property sales, title issues, and related real estate matters.

Contact AR Law Partners today to schedule a consultation and learn more about your options.