Submitting Offers | Probate Homes for Sale

Submitting offers on probate homes for sale involves procedures that may differ from traditional real estate transactions. The following overview explains important considerations when submitting offers on California probate properties, including requirements that may apply under the California Probate Code.

Submitting Offers

What is the proper way to submit an offer on probate homes for sale?

All offers to purchase probate real estate should be submitted in writing. A common practice is to use the California Association of REALTORS® Probate Purchase Agreement and applicable addenda. Other purchase agreements may be used if they properly address the requirements of the probate transaction.

Depending on the circumstances, the purchase agreement should address:

• The Personal Representative’s authority to sell the property on behalf of the estate.
• Whether the sale requires probate court confirmation.
• The property’s condition and applicable disclosure exemptions.
• The terms of the purchase, including financing, contingencies, and closing requirements.
• Any applicable court approval requirements concerning real estate commissions.

Who are offers submitted to in a probate sale?

As with traditional real estate transactions, offers are generally submitted to the listing agent, who presents them to the Personal Representative.

In some cases, the Personal Representative may direct that offers also be provided to the estate’s probate attorney.

Who accepts and rejects offers submitted on probate real estate sales?

The Personal Representative generally has the authority to accept, counter, or reject offers, subject to the authority granted by the Probate Court and applicable California probate requirements.

When the Personal Representative has full authority under the Independent Administration of Estates Act (IAEA), a real property sale generally does not require court confirmation, provided applicable notice and other statutory requirements are satisfied.

When the Personal Representative has limited authority, or the sale otherwise requires court supervision, court confirmation may be necessary before the sale can be completed.

When is the Best Time for Submitting Offers on Probate Real Estate?

Generally, offers may be submitted while a probate property is being marketed for sale. Offers received by the probate real estate agent should be presented to the Personal Representative in accordance with the agent’s legal duties and the seller’s lawful instructions.

Do contingent offers require court confirmation?

• Personal Representatives acting with full authority under the Independent Administration of Estates Act (IAEA) may generally consider offers containing financing or other contingencies without obtaining court confirmation, provided applicable probate requirements are satisfied.
• When a sale requires court confirmation, the terms of the offer, including financing and contingencies, must comply with applicable California Probate Code provisions and court requirements.
• California Probate Code §10315 addresses credit sales and court approval of certain financing arrangements. The estate’s probate attorney should advise on the requirements applicable to the proposed sale.

Is there a minimum price that probate estate real property must be sold for?

For a private sale requiring court confirmation, California Probate Code §10309 generally requires an offer of at least 90% of the property’s appraised value. Both the appraisal and its valuation date must be within one year before the confirmation hearing.

This statutory minimum does not generally apply to a sale conducted without court confirmation under full IAEA authority. The Personal Representative nevertheless has a fiduciary responsibility to act in the estate’s best interests.

Is a minimum deposit required?

• For sales conducted under full IAEA authority without court confirmation, the deposit is generally negotiated as part of the purchase agreement.
• For court-confirmed sales, deposit requirements may depend on the California Probate Code, applicable local court rules, and the terms of the sale. Buyers should verify the requirements before participating in a confirmation hearing.

When does an accepted offer need to be filed for court confirmation?

Under California Probate Code §10308, when court confirmation is required, the Personal Representative must report the sale and petition for confirmation. If the Personal Representative does not file the report and petition within 30 days after the sale, the purchaser may file them.

Buyers considering this procedure should consult a California probate attorney.

Sales conducted without court confirmation under full IAEA authority are not subject to this confirmation-petition requirement.

Submitting Offers With Overbids | Probate Homes for Sale

Can an original bid be overbid at the hearing to confirm the sale?

• When a Personal Representative sells real property without court confirmation under IAEA with full authority, there is no court confirmation hearing or statutory overbid procedure.
• When a sale requires court confirmation, another qualified buyer may appear at the hearing and submit a higher offer. This is known as an overbid.

What is the minimum amount required for an overbid?

Under California Probate Code §10311, the first overbid must exceed the original accepted offer by at least:

• 10% of the first $10,000 of the original bid, plus
• 5% of the amount exceeding $10,000.

Example: If the original accepted offer is $100,000, the minimum opening overbid is $105,500.

The calculation is:

• 10% of $10,000 = $1,000
• 5% of the remaining $90,000 = $4,500
• Total required increase = $5,500
• Minimum opening overbid = $105,500

After the opening overbid, the court determines the increments for subsequent bids. Bidding may continue at the confirmation hearing until the court determines the successful bidder.