Estate administration is a major commitment. The personal representative who settles the estate assumes numerous forms of responsibility. In some cases, they might be liable to creditors or even the beneficiaries of the estate if they make mistakes during that process.
Understanding the obligations inherent in estate administration and avoiding common mistakes are important for those who agree to serve as personal representatives. Certain circumstances increase the likelihood of probate controversy.
If the estate contains real property, usually the home of the decedent, there are many opportunities for costly mistakes to occur. The are some of the most common probate mistakes that may arise when an estate includes the primary residence of the deceased individual or other real property.
Failing to secure the property
There could be several people who have keys to the decedent’s home. Their children, romantic partners or neighbors may have access for support purposes. Those individuals could attempt to remove valuable property from the home, thereby diminishing the value of the estate. Personal representatives generally need to take steps to secure the property to prevent unauthorized access. Not only do they need to address the possibility of known parties accessing the property for questionable purposes, but they also need to protect the property from vagrants or teenagers seeking access to cause property damage or engage in illegal behavior in the home.
Letting the home sit vacant
It is common for a home to sit empty for weeks or even months after the owner dies. However, a vacant property poses many different risks. As previously mentioned, the vacant property could attract the attention of criminals. Beyond that, there may be reason to worry about pipes bursting and damaging the home. Vacant properties can suffer major damage when there is no one there to identify issues as they arise. Insurance costs may increase if the property sits vacant for too long. Additionally, the value of the home may drop if it sits vacant for an extended period.
Selling the home for an unreasonable amount
Personal representatives have a fiduciary duty to the beneficiaries of an estate. They should try to retain estate value to the best of their ability. If their responsibilities include selling certain assets, such as the home of the decedent, they should try to secure at least the fair market value for those assets. Selling the property to someone for less than the appraised value could lead to controversy and possibly financial liability. Even in scenarios where the testator extended the right of first refusal to their beneficiaries, it is still necessary to secure a fair market value for the home when selling it.
Those overseeing estate administration can reduce their exposure by securing the right support. Partnering with a probate attorney can reduce the likelihood of mistakes and oversights that can cost a personal representative money or damage their reputation.
