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It’s so important to understand your ownership interest when you inherit a property. Here’s a story of why and what can happen if you inherit a property and choose not to hire an estate professional to help you with the paperwork. What follows is a tale of why this is so important.
Jennifer signed a Listing Agreement and Contract, certain that she owned her deceased Mom’s (Kate) home as the sole owner. However, the title search revealed that, in fact, she only owned 1/3 of Kate’s house. Why?
Kate owned the house as sole owner. Kate died intestate (without a probated will), unmarried, in 2017. Kate had three children: Jennifer, Mike, and Veronica.
Veronica predeceased Kate. Veronica had one son, Kevin.
Once Kate passed away, who owned her house? Jennifer, Mike, and Kevin (Veronica’s son).
Mike and Kevin didn’t want Kate’s house. They wanted Jennifer to get their share. They called the probate clerk, and the clerk told them they could file disclaimers if they didn’t want their interest. So, they did.
Jennifer decided to rent the house for several years. Recently, she decided to sell. She signed a listing agreement with a wonderful agent, listed the property, and it went under contract quickly.
However, when the title work came in, the list of heirs and disclaimers filed by Mike and Kevin came up on the search. Instead of Mike and Kevin giving their interest to Jennifer, in fact, by filing those disclaimers, they passed their interest to their heirs (NOT back to Jennifer as they intended). Mike has 4 adult kids. Kevin has two minor kids.
So, who actually owned the house? Jennifer as to 1/3, Mike’s 4 adult kids collectively own 1/3 (each owning 8.33%), and Kevin’s two minor kids collectively own 1/3 (each owning 16.66%). This means that Jennifer didn’t have the right to be the only one renting out or selling that house – she needed the agreement of the other co-owners.
How could this scenario have been avoided? By hiring an estate attorney to assist the family when they filed the initial probate paperwork. If Mike and Kevin intended for Jennifer to have their shares, they could have gifted her their interest in the property by deed. Unfortunately, filing the disclaimers not only complicated the process, but it did not serve the intended purpose.
Ultimately, between hard work and the involvement of many cooperative family members, all interested parties were able to agree to resolve the outstanding interests and get to closing on time. Not every family would have found a way to cooperate.
This article is not intended to provide legal advice. This email does not create an Attorney-Client relationship, and nothing set forth herein is to be construed as legal advice or as a substitute for the advice of a duly licensed attorney. Seek legal counsel from an attorney admitted to practice in your jurisdiction if you need legal advice or representation.
