Executors administer the estates of individuals who die with a will. Their basic task is to inventory estate assets, pay debts and distribute bequests to beneficiaries of the will. When real estate is involved, however, the job can get complicated. Specific state laws regulate the sale of property through probate; in general, these laws give the executor wide latitude to list and sell a home, if necessary.
Executor Duties and Authority
Through appointment by a will's testator, or by a probate court, an executor serves as the administrator of a will. She carries out the terms of the will according to the law and in the best interests of the estate. The executor is responsible for paying the debts of the decedent out of the estate assets. There's no authority to serve as executor of an estate until she is legally authorized by the probate court to which the will has been submitted.
Read More: Does the Executor Have Authority Over the Will?
First Duties of an Executor
Probate courts issue letters testamentary to authorize the executor to act under the court's supervision as the administrator of the estate. The executor has the authority to inventory estate assets and engage an appraiser to determine the market value of those assets, including real estate. This is the first step in the administration process, along with inventorying liabilities and debts. If insurance premiums or taxes are due on a property, for example, the executor must pay them promptly to avoid any lapse in insurance coverage or the filing of tax liens against the home or business. No property can be sold until an executor is appointed.
Probate and Trust Assets
A trust is not the same as a will; assets held in trust are under the control of a named trustee. The trustee has a role like that of an executor; he's there to carry out instructions and distribute assets to beneficiaries. Property held in a "living" trust -- one created during the grantor's lifetime -- does not go through probate; therefore the executor has no control over it. "Testamentary" trusts created by wills after the grantor dies, however, are subject to probate court supervision. If there are outstanding debts against the estate that are not covered by assets, creditors can force a sale or foreclosure of property, whether or not it goes through probate.
Mortgages in Trouble
If the deceased was behind on his mortgage, or if he has property in foreclosure, the executor is responsible for bringing the loan current, if possible, and has the authority to hire an agent to sell the home, if necessary. The executor must take into account that certain debts, such as federal estate taxes, may take precedence over secured loans such as mortgages. If the property is in foreclosure, the executor may be able to negotiate a dismissal of the case if he can bring the loan current. State law may prevent foreclosure by exempting homestead property or a certain amount of equity in that property if the owner dies. The law may also set a floor under the sale price; in California, for example, the sale price must be at least 90 percent of appraised value for all property sold through probate or trust administration.
References
Writer Bio
Founder/president of the innovative reference publisher The Archive LLC, Tom Streissguth has been a self-employed business owner, independent bookseller and freelance author in the school/library market. Holding a bachelor's degree from Yale, Streissguth has published more than 100 works of history, biography, current affairs and geography for young readers.