Top 5 Mistakes Executors Make
When Selling the Family Home
Executors (or Estate Trustees as they are know in Ontario) are the individuals appointed in the will to carry out the final affairs of the deceased. It is a big responsibility and carries with it equally big liabilities if the estate is not handled properly. These are some of the common mistakes Estate Trustees make when dealing with the real estate holdings.
Mistake #1 Failure to Obtain the Certificate of Appointment Before Listing the Home For Sale
Many Executors or Estate Trustees don’t realize that an estate can not be listed for sale until the court issues a Certificate of Appointment of Estate Trustee (formerly call Probate). This validates the will and confirms the status of the Estate Trustee with full legal power to execute the will. There may be exceptions when a property can be listed prior to this step, but a lawyer should always be consulted before proceeding with the sale of the estate property.
Mistake #2 Failure to Select the Right Agent for the Job
After the death of a loved one, many Realtors will appear on the scene anxious to list the home for sale. Family members and beneficiaries may have their favourite Realtor that they have worked with in the past, but that doesn’t make them the best fit for this job. While it may be tempting to work with an Agent you know, a friend or even a family member, that type of situation can also create conflicts. You need an unbiased, experienced Agent who will provide an accurate market evaluation of the property, understands the process and time-lines involved in estate sales, is prepared to answer your questions, meet with beneficiaries or other family members and guide you through the steps without anyone feeling pressured.
Mistake #3 Failure to Secure the Property
Once a loved one passes away, one of the Estate Trustee’s first obligation with respect to the family home is to ensure that it is safe and to keep it safe during the administration of the estate.
Changing the locks to the house is a good idea. Many people outside the family such as care-givers, neighbours, cleaning services etc may have had keys to the home. A locksmith can replace locks or re-key existing locks and provide new keys.
Mistake #4 Failure to Maintain Adequate Insurance on the Home
When you take over as Estate Trustee, you need to locate the house insurance policy and notify the insurance company that the home is now vacant. Vacant homes are at risk for vandalism and break-ins and most policies have specific requirements about how often the home needs to be checked. Failure to comply with this may result in the policy being void. They may also require extra coverage on a vacant home. Be sure that you also consider fire and liability coverage.
Mistake #5 Failure to Maintain the Home
Executors are required to maintain the family property. In addition to having the home regularly checked for insurance purposes, they will also need to arrange for maintenance - ie grass cutting, snow shoveling etc. Utilities such as gas, hydro and water will need to be kept running and the accounts kept up to date. If the home is going to be vacant in the winter, the heat must be kept on to ensure pipes don’t freeze. When it’s time to sell the property, buyers need to have the utilities functioning for viewing the property and performing home inspections.
Have your questions answered and learn more about selling a family estate at www.SellingTheFamilyEstate.ca
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