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How title disputes arise when buying property from an estate

On Behalf of | Jun 29, 2021 | Real Estate Law |

Buying a home is difficult when inventory is low and demand is high. The last few years have resulted in a very competitive real estate market that leaves many people in the Boston area struggling to acquire housing.

Most people who find the right house and make a competitive offer on it will be able to quietly enjoy that property for years to come. However, if someone else has a claim to that property, the new owner could find themselves in a difficult situation. They might have to go to court or could even lose possession of their home.

Although anything from fraud to inaccurate public records could lead to title claims, selling real estate as part of the administration of an estate is a common cause of title issues with residential properties. What about buying a property from an estate increases the likelihood of a title conflict?

Sometimes, the executor can’t locate the heirs

It is the responsibility of the executor or administrator of the estate to secure the assets left behind by the deceased, pay their debts and then distribute the remaining property to their loved ones. Estate administration often requires that an executor sell certain assets to split the proceeds among multiple heirs.

Sometimes, if there aren’t instructions leaving someone’s real estate to a specific individual, the executor will sell the property and share the proceeds from the sale among the beneficiaries of the estate. If they don’t locate all of the heirs with a claim to the house or a share of its value, those individuals might later bring a claim against the property.

Sometimes, people find an estate plan too late

If family members couldn’t locate an estate plan or last bill, they may have asked the courts to handle the estate as an intestate one. Instead of following the wishes of the deceased party, they instead apply state intestate succession laws to all of the property, including the house.

If a last will or estate plan later turns up, it may be that the property should have passed to a specific individual. That could also lead to title claims.

Recognizing the risks possibly associated with buying real estate from someone’s estate can help you make better buying decisions, like choosing to conduct a thorough title investigation and purchase title insurance.



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