Dealing With The Real Estate Holdings as Trustee
Securing and Evaluating the Real Estate Holdings
Maintaining and Cleaning out the House
The Big Sort - The Final Clear Out
One of the tasks you have been entrusted with in your role as Estate Trustee is to deal with the family real estate holdings. Your first priority is to securing and evaluate these holdings. Then you need to maintain the property and start the task of clearing out the home and getting it ready for sale.
1. Take Pictures
It’s a good idea to take pictures of the house and it’s contents as soon as possible after death. This will serve as a record of what was in the house and what condition things were in. This will also be helpful if you need to make an inventory of the items for probate application, tax purposes or the beneficiaries.
2. Gather Important Documents
The first pass through the house, you need to look for wallets, cheque books, financial statements, credit cards, birth certificates, Social Insurance cards, health cards, insurance policies, stock certificates, deed to the property, survey, mortgage documents etc. Many seniors don’t keep all their paperwork together and may have filed it in unexpected places.
3. Secure the Property
It’s the Estate Trustee’s responsibility to ensure that the home and its contents are secure. Changing the locks to the house is a good idea. Many people outside the family may have had keys to the home such as care givers, cleaners, neighbours etc A locksmith can replace locks or re-key existing locks and provide new keys.
4. Check the Property Insurance
Once you locate the house insurance policy, you will need to notify the insurance company that the property is vacant. Vacant homes are at risk for vandalism and break-ins and most policies have specific requirements for these homes. They may require the home be checked every few days or the policy is void. They may also require extra coverage. If the home is being sold, an Agreement of Purchase and Sale will require that the home be insured right up to the day of closing. You will also want to maintain liability insurance in the event a potential buyer, for instance, slips and falls while viewing the property when it is listed for sale.
5. Collect Valuables
Gather up jewelry, special collections, stamps, artwork, coins and other valuables, fragile or breakable items. Set these aside in a safe, secure place until you can distribute them to the heirs or have them professionally evaluated and disposed of. It may be best to even store these items off site in a secure location to prevent loss or damage.
If there are items that are dealt with in the will or family members agree on where they should go, label those items and try to get them removed from the property before the major sort begins.
Keep an eye out for the safety deposit box key if you don’t already have it. In your search, you may come across many odd keys. Keep them together in one location so you can eventually match them to their proper locks.
Also, if you find a current Yellow Pages book, don’t be too quick to toss it. That can be an invaluable resource, especially if you are not from the area. You never know what services you will need to source out.
6. Property Appraisal
As well as getting professional appraisals on items in the home, you will also need an appraisal of the property itself. The market value of a home can be determined by a Realtor or Accredited Appraiser. A Realtor can provide an “opinion of value’ through a “Comparative Market Analysis” which looks at sales of comparable homes in the neighbourhood. This service is generally provided free of charge for the opportunity to list the property down the road. An accredited Appraiser can perform a full appraisal that is recognized in the courts. An Appraiser will charge for this service but this appraisal may be required for probate. In most cases, the opinion of a Realtor will be sufficient if there is not likely to be any dispute about the value of the property. Your lawyer will give you direction on this.
If you need to call in a Realtor, you will want an experienced Agent who is familiar with estate sales. They need to provide an accurate opinion of value and tips on what you need to do to get the most value out of the property. They may also need to meet with beneficiaries or other family members to ensure everyone is comfortable that the Realtor is acting in everyone’s best interest.
Next Steps - Maintaining the Home and Starting the Cleaning Out Process
1. Sort the Mail
Go through any mail in the house. Bills, bank statements etc will help to determine assets and any outstanding debts. The mail can also provide evidence of credit cards that you were unable to locate. It is now the Trustee’s responsibility to ensure all bills are paid and accounts kept up to date. Determine what accounts can be cancelled such as credit cards, subscriptions to newspapers and magazines. You will want to maintain heat, hydro and water utilities to keep the property functional through to the final sale. The mail can be redirected to the Trustee to ensure that no future bills or statements are misplaced and cut down on mail piling up at the house.
2. Arrange for Care of a Vacant Property
You will need to arrange not only for the house to be checked regularly for insurance purposes but also arrange for maintenance such as grass cutting, snow shoveling etc. If the home is going to be vacant in the winter, be sure to keep the heat high enough so pipes don’t freeze. It’s also a good idea to flush toilets and run faucets every week or so to keep everything in good working condition. If the estate happens to be a condo apartment, you should be aware that some condo apartment buildings even require that you have someone run water and flush toilets if the suite is vacant.
If you don’t have family or friends living close by, a property management company could be hired to perform these duties.
3. Perishable Items
Check the fridge, freezer, cupboards and the pantry for perishable foods. Anything that will spoil such as meat, fruits, vegetables along with opened or partially used products should be discarded. Unopened food in sealed containers, cans, plastic packs can be dealt with later and might be useful for a local food bank. Foods in the freezer don’t need to be dealt with right away if the freezer is functioning well. However, if items aren’t labeled and dated, they will most likely need to be disposed of.
4. Disposing Medicines
Over the counter and prescription medications should not be tossed in the garbage or flushed down a sink or toilet. Most pharmacies will take back medications and syringes or needles they have sold to you. You can also drop these items off at a Household Hazardous Waste Depot. The Halton site is located at 5400 Regional Road 25, Milton. Check for details and hours by calling 905-825-6000 or visit www.halton.ca/waste
5. Selecting Mementos
Let each family member including children, grandchildren, nieces, nephews etc supply a list of items they may like or have them go through, select and label special mementos. You may be surprised what family members treasure as their memories. Unless there are any disputes, let the family remove their items. In the case of disputes set the items aside and deal with as you go down the road (members may change their minds or you may find a way to make the selection amicable to both parties)
Don’t forget special friends of the deceased family member. They will be truly touched at being asked and will be grateful to be able to have a memento of their friendship.
The Big Sort
Sorting through a home after the death of a loved one can be bittersweet. It’s best to attack the job with a group of relatives and consider it a celebration of life. Stories and memories will make this overwhelming task a pleasurable and unforgettable time.
Tackle one room at a time. If you have help, assign a room to each helper. In this exercise, you need to decide whether to 1. Keep, 2. Sell / Donate or 3. Trash it. Make 3 piles. Before dealing with the Sell / Donate or Trash piles, other family members may want to take one last look through to ensure there are no items that they would want. There will always be items that get discarded and will come up in conversations years later “I wonder what ever happened to...” but you can only keep so much - remember your kids will then have to go through this same exercise for you!
1. Doubts About the Value of a Item
As you go through this process, if there is any doubt about the value of an item, set it aside and have it professionally appraised.
2. Check Everything
Look everywhere and in everything - especially those items that you are throwing out. Make sure there is no money stuffed in the toe of a boot or pocket of a jacket or between the pages of an old book.
3. Items to Sell
Generally in an estate, any items that are not given to a beneficiary or specifically listed to be sold on death, need to be converted to cash. That usually ends up to be primarily the contents of the house - and as you look around, you have to wonder how much value these items have. How much would someone pay for an old couch, outdated microwave, linens, pot and pans? After the beneficiaries, friend and relatives have taken any items they may want, there may still some items that have value and can be sold.
You can try to sell the items on your own through classifieds, word of mouth, onsite estate sale or garage sale. You may not want all this work and if there are enough items remaining of value, you can call in an estate auctioneer or liquidator. Depending on the size of the estate, they may hold a sale on premises or remove the items to be sold offsite. They will charge a fee or commission from the proceeds of the sale for this service.
4. Items to Donate
If you choose not to sell the remaining items or they are in good condition but you are not able to sell them, you may want to donate them. Organizations such as Salvation Army, Goodwill and Canadian Diabetes Association will even pick the items up and in some cases will supply a receipt for the charitable donation which can be used when filing the final tax return for the estate. Books can be donated to the Oakville Literacy Council for their annual book sale. Details at www.oakvilleliteracy.ca You can also donate to your local church or other local organizations.
5. Items to Trash
Whatever is left, can now be thrown out. Depending on how much you have, you may be able to put out to the curb for a regular garage pick-up, you can take to the dump or you may need additional services to help you dispose of the items. There are some great services now such as 1-800-Got Junk, or 1-888-445-Junk. If you have enough items, you may want o consider a disposal bin that can be delivered to the home and once you fill it, the disposal company will pick it up and take it to the dump. This could cost around $300-500 but depends on the weight of the items disposed.
Any sensitive paperwork that is being thrown out should be shredded first to avoid identity theft.
Hazardous items such as paint, solvents, motor oil, pesticides cannot be put out in the garbage or poured down the drain. These items must also be dropped off at the Household Hazardous Waste Depot. For Halton, you can get more details at www.halton.ca/waste
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