Probate of Real Estate

When a deceased owner is listed on the title to real estate, questions arise about the title to the property: Who inherited the property? Who can sign the deed or loan? Are there unpaid debts that could lead to creditor claims against the property?

Third parties–like buyers, lenders, and title insurance companies–need clear answers to these questions before accepting title to the property. Until then, title is defective. No one can sell, refinance, or deed the property until the title defect is resolved.

This guide explains how probate fixes this problem and establishes clear title in the rightful heirs or beneficiaries. It also provides strategies to determine whether real estate is a probate asset and whether any alternatives to probate apply.

What is probate of real estate? 

Probate of real estate is a legal process supervised by a probate court in which a personal representative transfers title of property owned by a deceased person to the person’s heirs or beneficiaries. It gives buyers, lenders, and title companies assurance that the court has determined legal ownership. Evidence of the probate proceeding is recorded in the chain of title to clear title, allowing the heirs or beneficiaries to sell, finance, or deed the property.

Why is probate of real estate required? 

To understand why probate is required, image a potential buyer evaluating whether to purchase property that is still titled in a deceased owner’s name. The buyer faces immediate uncertainty: Who inherited the property? Was the will valid? Who has authority to sign the deed? Could any creditors still have claims?

Until these questions are answered, the buyer won’t pay full price (if anything). And even if the buyer is willing to ignore these questions, lenders and title insurance underwriters won’t touch the deal. The property’s title is said to be “clouded” or “unmarketable,” and the deceased owner’s heirs can’t deal with it until these issues are resolved.

Probate clears the cloud on title that arises after an owner’s death. It confirms the heirs, validates the will (if there is one), authorizes the personal representative (executor) to act, and ensures that the deceased owner’s debts and taxes are paid.

When is probate of real estate required? 

State law determines whether probate is required based on how title to the property was held. If the deceased owner held the property individually or as a tenant in common—without a right of survivorship—the property is usually a probate asset (discussed below) because it remains titled in the deceased owner’s name and does not automatically pass to anyone else. Unless an alternative to probate applies, probate is required for probate assets.

What are non-probate assets?

Non-probate assets are assets a deceased person owns that pass automatically on the owner’s death, without requiring probate. Whether an asset is a non-probate asset depends on how title is held whether there are valid beneficiary designations.

Real estate qualifies as a non-probate asset when it’s title causes it to pass automatically to another person. There are several ways to use deeds to title real estate so that it avoids probate: 

• Survivorship deeds. If the property was titled jointly with other owners using a survivorship deed, and if there is at least one owner still alive, the property passes to the surviving owner without probate. Survivorship deeds vest title as either joint tenants with right of survivorship, tenancy by the entirety, or community property with right of survivorship.
• Life tenant interest. If the deceased owner was named as a life tenant in the vesting deed, there is no property right to inherit. The property passes to the remainder beneficiaries named in the life estate deed without probate. 
• Probate-avoidance deeds. If the deceased owner used a transfer-on-death deed, beneficiary deed, life estate deed, or lady bird deed to designate one or more beneficiaries to inherit the property at death, the property passes to those beneficiaries without probate. 
• Trust transfer deeds. If the deceased owner used a trust transfer deed to transfer the property to a living trust, the living trust–and not the deceased owner–owns the property. Probate is unnecessary because the property is not in the deceased owner’s name. 

In most cases, filing a survivorship affidavit in the land records is enough to update the chain of title and establish clear ownership of real estate that is a non-probate asset.

What are probate assets?

Probate assets include all assets that are in a deceased owner’s name and that do not qualify as non-probate assets.

Probate assets cannot pass automatically to a new owner when someone dies. They stay titled in the deceased owner’s name until probate–or an alternative to probate–establishes title in new owners. 

If the probate asset is real estate, probate clears title to the property, allowing the deceased owner’s heirs to buy, sell, or deed the property.

What are the alternatives to probate?

A deceased owner’s probate assets form the deceased owner’s estate. Some estates can be transferred without full probate. Many states offer simplified procedures for small or straightforward estates, allowing heirs to transfer property faster and with less expense.

Whether an alternative to probate applies depends on state law. Each state is different, but many states recognize at least one of the following: 

• An affidavit of heirship is a sworn legal document identifying a deceased owner’s heirs. Some states allow it to establish ownership of real estate after a certain number of years have passed since death.
• A small estate affidavit is a sworn legal document that lets heirs collect a deceased person’s assets without probate if the estate’s value is under a the legal limit.
• A muniment of title proceeding is a simplified court procedure that allows a will to be admitted as a deed substitute without requiring the appointment of an executor or a full probate proceeding. It is used in a few states, like Texas and Mississippi.
• A small estate proceeding is a short version of probate for modest estates. Small estate proceedings often have statutory limitations on the estate value and the type and recipients of assets to be transferred.

These alternatives are not available in every case. State law sets limits—such as maximum estate value or required waiting periods—and title companies or financial institutions may impose their own rules. For example, many title insurers will not accept an affidavit of heirship until several years have passed after the owner’s death. 

In the real estate context, if no probate alternative applies, the estate must go through probate to clear title to the property.

Who inherits real estate on the death of an owner?

Who inherits a deceased owner’s real estate depends on whether the owner left a will.

• If the deceased owner had a valid will, the court recognizes it through probate, and the beneficiaries named in the will become the new owners.
• If there is no will, a body of state law called intestacy laws decides who inherits. Intestacy laws give property to the surviving spouse and closest relatives, such as children and parents, based on blood relationship to the deceased owner.

The probate issues an order naming the new owners. This order is provides clear legal proof of ownership that buyers, title insurers, lenders, and other third parties can rely on.

Who has legal authority to sign a deed after an owner dies?

During probate, the court-appointed executor—also called an administrator or personal representative—has exclusive legal authority to sign deeds on behalf of the estate. In many states, the executor must get court approval before transferring estate property. The court may ask the heirs or beneficiaries to also consent to the transfer.

If the property is not sold during probate, the executor sign’s an executor’s deed—sometimes called a personal representative’s deed—at the end of the process. The executor’s deed transfers title to the beneficiaries or heirs named in the court order.

The executor’s deed includes details from the probate proceeding so that future title examiners can understand how the deceased owner’s interest was updated in the chain of title. After the executor’s deed is recorded in the land records, the heirs or beneficiaries have clear title and can sign deeds on their own.

How does probate ensure that real estate title is free of creditor claims?

Probate helps ensure that heirs receive clear title by cutting off creditor claims against the deceased owner’s estate.

The executor must notify known creditors that an estate has been opened and publish notice to unknown creditors in a local newspaper. These notices give creditors a limited time—often a few weeks or months—to file claims with the court.

The executor reviews each claim, pays valid debts from estate funds, and rejects invalid ones. Once the claim period ends, no new claims can be filed. This finality protects the heirs and ensures the property can transfer with clear, marketable title.

What is the probate process?

Although each state’s rules differ, most probate proceedings follow the same general steps from start to finish.

01. Filing the petition to open the estate

Probate begins when the executor files the deceased owner’s will with the probate court, along with a petition asking the court to admit the will to probate. If the owner did not have a will, the petition will instead state that there is no will and ask the court to identify the heirs who inherited the property under the state intestacy laws. 

02. Appointment of the personal representative

The court will review the petition and issue formal documents–called letters testamentary or letters of administration–that authorize the executor to act on the estate’s behalf. This power allows the executor to access the deceased owner’s assets and take the steps necessary to complete the probate. 

03. Notice to heirs and creditors

Once appointed, the executor notifies any heirs or beneficiaries (assuming they have not already been notified in connection with the original petition) that the estate has been opened. 

The executor also notifies creditors. The executor sends letters to any known creditors, informing them of the details of the court proceeding and requests that they submit claims if they have them. The executor publishes notice to unknown creditors in a local newspaper. 

04. Inventory and appraisal of assets

The executor conducts an estate inventory to identify, value, and secure the probate assets. Some states require the inventory and appraisal to be filed with the court in formal probate proceedings. States that allow informal probate proceedings may waive this requirement. 

05. Payment of debts and expenses

Once any creditor claims have been submitted, the executor evaluates them for validity. Assuming the claims are valid, the executor pays them from estate funds. The executor can also use estate funds to pay funeral costs and any unpaid taxes. If there are not enough liquid funds to pay debts and taxes, the executor may petition the court to sell assets. 

06. Filing and paying taxes

The executor files any required tax returns and pays any associated taxes. Taxes are paid before distributing assets to heirs or beneficiaries. 

07. Distribution of remaining assets

Once assets have been collected, taxes have been paid, and debts have been settled, the executor distributes the property to the heirs or beneficiaries. In some situations, transfer documents–such as an executor’s deed to real estate–evidence the transfer of assets. In other situations, the probate court documents may be recorded as evidence of the asset transfer. 

08. Closing the estate

Once all of the work is complete, the personal representative asks the court to close the estate. If not waived, the executor must submit a final accounting of all cash collected and spent during the estate administration. Once approved, the probate court closes the estate and releases the representative from further duties.