Any way to avoid probate?

Question

I found a lead in which property owners are deceased. The grandson which also claims to be "adopted" by his deceased parents is now living behind the home in a vehicle. He clearly has a drug problem. The house has been condemned by the city because water has been turned off and the city will not turn it back on until he shows legal ownership. He has not started probate. Taxes are in the rears and he really has done nothing productive.

Are any of you familiar with "Affadavit Lack of Probate"? I've read in WA that it can be an effective way to transfer title without probate. He says there are stocks and bonds that he would be heir to. My understanding is traditional probate would be necessary to lay claim to these stocks. I however am not interested in any of that, only the property.

If what he is telling me is accurate and that he just doesn't have the financial resources or mental clarity to move forward, what is the best way to help him if he is willing to sell me the property? I've heard this Affadavit would be much less expensive and faster than an ancillary probate. Can an attorney draft up a contract that spells out he is obligated to sell the property to me at the agreed price when title becomes vested in his name?

It appears there are limited heirs and no creditors. Does anyone have experience with this sort of situation?

Davido Davido · Answer

Hello @Eric Roloson,

I may have different goals and timelines in mind, but if I was targeting the property, I would seek Quit Claim deeds from every heir I find, the Grandson, the Daughter, and the other grandson too.  The Affidavit of Lack of Probate can be used if you are named in the Decedent's will (not applicable for you), or when you are the legal heir (or have obtained the interest of the legal heir).   The order for legal heirs in WA can be found under RCW 11.04.015.

https://app.leg.wa.gov/RCW/default.aspx?cite=11.04.015

Basically, the WA order of heirs is 1st the Spouse, then children, then the descendants of the children, then parents, then other descendants of the parents (brothers and sisters of the deceased), followed by the descendants of the brothers and sisters, then Grandparents of the deceased, followed by descendants of the Grandparents.  Since the owning couple is deceased, their children are the heirs.  Get a quit claim from all the children of the deceased couple, and you can file your Affidavit of Non-Probate.

The Quit Claim deed will need to be notarized, so I recommend that you familiarize yourself with a couple different mobile notaries in your area.  My experience is that deciding to sign a deed is often an emotional choice, which can change at the slightest of difficulties.  Having a Notary come to the signer, can eliminate the difficulty of getting to a notary

If you plan to resell the property and want it insurable, then definitely consult with a title company before signing any deeds.  They may have additional requirements and recommended forms.

If you can not get the daughter to deed her interest, or if there are multiple children who are heirs, and some won't sign, that is when I would use the Grandson's Quit Claim Deed. If the daughter dies, the quit claim deed gives you some title, and an arguable color of title until then. If the other children do nothing with the property, it may be possible to claim it as abandoned. If a property is abandoned by the owner, then you can take over the property, rent it out and eventually get clear title in your name via the WA laws of Adverse Possession (7 years with color of title). See this Blog for a discussion of the legalities.
https://www.biggerpockets.com/member-blogs/12388-abandoned-property-adventure-on-wildside

Be aware that a non owner and non lien holder can only pay another person's property taxes in WA (to prevent the property from being foreclosed for back taxes) up until the date the County starts its Foreclosure by filing a Certificate of Delinquency. At that point, only the owner of record or a recorded lien holder can pay the back taxes. So if you plan to take action on the property, it pays to be aware of the date your county files its Certificate of Delinquency.

I mention taking over the property without title, because in my experience with similar situations, the heirs do nothing with the property and the county forecloses. I'd rather collect rent for years on a property that I don't own, than see it further wasted until its foreclosed. That is not a workable plan for most people, but it can be done.

Account Closed · Answer

He's pulling your leg. I'll bet you a spotted owl BBQ sandwich that he is simply a squatter. I haven't heard of a house being condemned because the water was turned off, even here in Arizona where we kinda need water just to survive.

Get a title report & also find out from the neighbors what the true story is. If true, the thought that there are "limited heirs" is really scary. That means one of two things 1. Just when you think you have every thing completed, an "heir" will pop up and claim an interest. or 2. The title company will never issue title insurance because they can't guarantee all "heirs" have been accounted for and money from the sale has to be dispensed according to law anyway.

Have the guy in the back of the house sleeping in the bombed out 1971 Ford Pinto with the Jack Daniels, give you the names and contact information of one or two of the other "heirs" so you can get to the bottom of things. I guarantee he can't remember their names and doesn't know where they are. Until you get in contact with a real "heir" this goes nowhere.

Eric Roloson · Answer

@Davido Davido very interesting!

I'm excited to read these articles. Intriguing- I will connect with you when I read about your past/current ventures! It's great to see that strategy is working for you. Thank for shedding new light on what I'm up against and how I might work through some of the obstacles

Ibrahim Hughes · Answer

@Eric Roloson

You received some great information. The only thing I would add is that if you decide not to or can't get quit claim deeds, definitely get the rightful heirs under contract as "individuals and Heirs of the estate". Have some type of legal claim before you do any paperwork or spend any money.

Eric Roloson · Answer

Nice! I will look into this right away. Thanks a ton Account Closed

Eric Roloson · Answer

Thank you Account Closed I appreciate your candor.

Perhaps I will go down the rabbit hole as far as my opportunistic senses will allow. I suspect I will hit a point when it is not worth the time/effort. However, as you mention the learning process will be advantageous to me. It's interesting and I will pursue and followup on the first steps you mention.

What are the implications if I verify the grandson was legally adopted by grandparents? Would it pass down 50/50 with the mother? This distribution is something I can look up in state code, but wondering if you know off the cuff.

My angle was to use an Affidavit of Lack of Probate to avoid probate as decedent did not have a trust, joint tenancy with right of survivorship, community property agreement, ect.

Once the affidavit is recorded with the county auditor, the net effect is to vest title to the "rightful" or legal heirs since there is no will. I would comply with estate tax obligations if necessary. Ever heard of transfer clearance certificate from IRS? I am not familiar with this.

My understanding would be the beneficiaries should buy title insurance to insure their vested interest in conjuction with recording the "affadavit". Title insurance companies may request an "affadavit" be signed on behalf of the estate (and/or by the heirs) as a condition of issuing title insurance. If a proper Affadavit Lack of Probate is recorded this is a document in the county records relating to the passing of a seller, which in effect, clears title.

Even if that has some validity, we have to look at your point. She may choose not to sell to me or at all! Can a competent attorney help draft up a contract that "new" owner will immediately sell to me or even do it at the same time?

I'm not trying to beat a dead horse just finding and creating paths to accomplish my goals :) thanks again for your input

Eric Roloson · Answer

Account Closed I added this tag as I forgot when last posing :) Please reference above

Account Closed · Answer

Looking at

RCW  82.45.197

Exemptions—Inheritance—Documents required.

I'm willing to guess that at a minimum you need certified copies of the death certificates of everyone on title, the "Affidavit of Lack of Probate" (which I didn't need so I'm not familiar with it nor the implications of putting someone on who shouldn't be there or leaving someone off who should be there) and you will need the mother's cooperation.In the quick search I did I saw two local title companies who have policies on this so I'd call them and ask for their guidance. I think I would also ask timelines. You could still be at this until Christmas 2020.

Account Closed · Answer

Next time I'm in Kelso BBQ spotted owl is my treat. ;-)

The daughter probably has a right to the property if she is a direct heir, the grandsons do not unless she passes away, unless they were specifically mentioned in the will and it goes through probate naming them. Which is a good thing for you, because here is the next set of challenges, if the chain of title winds up with the grandson's names on it, any liens & fines they have against them get applied to the property. And, if they are the nefarious duo you think they are, there will be a LOT of liens, fees and unpaid liabilities that get attached to the property that you would have to pay off. Keep their names off title at all costs. It doesn't sound like they have ANY claim to the property anyway. Having lived there is not sufficient to establish a claim if a direct heir (such as their mother) is still alive. I know, it's like Alice in Wonderland and you never know which way the rabbit hole goes.

It's likely this will have to go through probate. That is a lot of paperwork and it's a little tricky but once you learn it, it's really useful going forward in your real estate investing. I probated my folks estate in King Co and it meant a bunch of paperwork, a few trips to probate court to get authorized as executor, paperwork for insurance and property and on and on. In my case I had to get affidavits from siblings (which was no problem) and eventually I controlled the estate. Then I had to pay any outstanding claims (I forget what the period of time I had to wait for claims to come in is but it was a couple of months) then I could sell property and once all tax and other claims were paid I could disburse funds. You have to hold back a percentage of money in case a late claim comes in.

So, for you, the first step is to get a title report and see what it says, then to get the mother appointed as executrix (takes time & money and her cooperation) but then during the process and after that you never know what she is going to do. She may choose not to sell at all or even to sell the property to someone else or even let the nefarious duo live in the property. She controls everything.

On the other hand, if she will agree in court to appoint you as a substitute, that makes you a fiduciary and you could run into legal trouble buying the property for yourself.

I'm not sure how you want to proceed but those are the basic issues.

Ibrahim Hughes · Answer

@Eric Roloson

Where the contract names the seller, I add ",individually & as heirs of the estate of ".

Of course this isn't legal advice .

Any way to avoid probate?

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