Probate & Trust Resource

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Introduction

When a California homeowner dies without a living trust, their estate must typically go through probate—a court‑supervised process that ensures debts are paid and assets are distributed correctly. Real property often represents the largest asset in an estate, so understanding the probate sale process is crucial. A trust sale occurs when a property is held in a living trust; in that case, a trustee can usually sell without court supervision, making the process faster and more private.  Below is an overview of important information an executor or trustee may encounter. 

 Probate

A court procedure to identify a decedent’s heirs,  inventory and appraise assets, pay debts and taxes, and distribute the   remainder to beneficiaries.

Personal Representative

The individual appointed by the court to administer the  estate. If the decedent left a will, this person is the Executor; otherwise   the court appoints an Administrator.

Independent Administration of Estates Act (IAEA)

California law that allows a personal representative to administer an estate with Full Authority, reducing court oversight for certain acts (such as selling real property).

Full Authority

The personal representative may list and sell property without court confirmation if they have full authority. After accepting an offer and issuing a Notice of Proposed Action (NOPA), beneficiaries have 15 days to object; if no objections, escrow can close.  Often times, waivers are utilized. 

Limited Authority

The personal representative must sell the property for at least 90 % of the court‑appointed appraisal and obtain court   confirmation. A probate referee provides two appraisals (date‑of‑death and current fair market value). Buyers often participate in a court hearing and may need a 10 % deposit.

Probate Sale Timeline

The probate process in California generally takes 12 – 18 months and sometimes longer, depending on the estate’s complexity and court backlog. The following timeline outlines key milestones for an estate being probated and a property sold under the Full Authority option; with Limited Authority, additional steps (appraisals and court confirmation) extend the timeline.

1. Petition for Probate (Day 1) – File the will (if any) and a Petition for Probate (Form DE‑111) with the Superior Court in the county where the decedent lived or owned property. Publish notice of the first hearing in a local newspaper and mail it to heirs and beneficiaries.
2. Initial Hearing (Week 5‑6).  The court reviews the petition and appoints a      personal representative.
3. Letters Testamentary/Administration (Week 8).  The court issues Letters Testamentary (for executors) or Letters of Administration, authorizing the representative to act for the estate. A surety bond may be required.
4. Inventory & Appraisal (Within 120 Days).  The representative gathers and appraises all assets, filing an Inventory and Appraisal with the court. Creditors are notified.
5. Property Sale (Week 12‑13) – If the estate includes real property, the representative can begin marketing the property. Under Full Authority, the property can be listed and sold before all other probate steps are complete. With Limited Authority, the property must be sold for at least 90 % of the reappraised value and requires court confirmation.
6. Creditors’Period (4 Months) – Creditors have four months to file claims; resolving disputed claims can delay the process.
7. Tax & Final Distribution (Week 24‑52) – The representative pays debts and taxes, submits an accounting to the court, and petitions for final distribution. If the process exceeds one year, a status report must be filed with the court.

Step‑by‑Step Guide to Selling Probate Real Estate

Selling a probate property involves several legal and marketing steps. The process differs depending on whether the personal representative has Full Authority (IAEA) or Limited Authority.

1. Initiate Probate and Obtain Authority

• File  for probate and request appointment as personal representative.
• Wait  for Letters Testamentary/Administration. This document grants you the  authority to enter contracts and sell the estate’s real estate.
• Determine  whether you will operate under Full or Limited Authority. Full authority typically allows a sale without court confirmation; limited authority requires court supervision and sale at a minimum of 90 % of the  appraised value.

2. Prepare the Property

• Appraisal – For limited authority sales, a probate referee provides two appraisals:      date‑of‑death value and current fair market value.
• Clean,  haul, and repair – Remove personal belongings, arrange hauling and deep  cleaning, complete minor repairs and deferred maintenance to maximize  value.
• Staging  & professional photography – Stage the home for buyers and use high‑quality      photography and 3‑D tours to showcase the property.
• Pre‑sale inspections – Consider home, termite, roof and sewer inspections to disclose issues up front. Providing detailed up front reports can reduce buyer contingencies and renegotiations.

3. Determine Pricing Strategy

• Market Analysis – Work with a probate‑experienced Realtor to evaluate comparable  sales and market conditions. Under limited authority, the property must be  listed at or above 90 % of the court‑appraised value.
• Full  Authority – Allows more flexibility in price. A Notice of Proposed Action  is issued after accepting an offer; beneficiaries have 15 days to  object.
• Deposits – For full authority sales, deposits can be as low as 3 %. Limited  authority sales often require 10 % deposits and may include overbid opportunities at a court hearing.

4. List and Market the Property

• Multiple Listing Service (MLS) – Input the property on the MLS to expose it to  Realtors and buyers.
• Digital Marketing – Create a property website, use targeted email campaigns,  social media advertising and 3‑D virtual tours to attract qualified buyers.
• Open Houses & Broker Tours – Host open houses and broker previews to  increase exposure. Provide prospective buyers with disclosure packets and inspection reports up front.
• Highlight Probate Details – Clearly disclose that the sale is subject to probate.   For limited authority sales, note that court confirmation and minimum  price requirements apply.

5. Accept an Offer & Handle Notifications

• Offer Review – Evaluate offers based on price, financing, contingencies and  timeline.
• Notice of Proposed Action (Full Authority) – After accepting an offer, the estate’s attorney or representative prepares a Notice of Proposed Action.  Beneficiaries have 15 days to object; if they do not, the sale can  proceed.
• Court Confirmation (Limited Authority) – For limited authority sales, once an acceptable offer is received, a court confirmation hearing is scheduled.  The sale is published in a newspaper at least three times. At the hearing, overbidders may submit higher bids; the successful bidder must deposit  10 %.

6. Close Escrow

• Full Authority – If no objections are filed, escrow can close shortly after the  15‑day notice period. Ensure all contingencies are removed and final  paperwork is complete.
• Limited  Authority – After court confirmation and overbid (if any), escrow closes  and proceeds are distributed to the estate. The representative remains  responsible for final accounting and distribution to beneficiaries.

Frequently Asked Questions (FAQ)

Q1. What is probate?
Probate is the court‑supervised process that collects a decedent’s assets, pays debts and taxes, and distributes the remainder to beneficiaries.

Q2. When is probate required?
Probate is generally required when the decedent owned assets in their name alone worth more than $184,500 (subject to inflation adjustments). If the property was held in a living trust, the sale is handled by the trustee without court supervision.

Q3. Who can sell real property during probate?
The personal representative (Executor or Administrator) has authority to sell estate property once the court issues Letters Testamentary or Letters of Administration.

Q4. What is the difference between Full Authority and Limited Authority?
With Full Authority under the IAEA, the representative can sell property without court confirmation, subject to notice to beneficiaries; deposit requirements are lower (typically 3 %). With Limited Authority, the sale must be at least 90 % of the court‑appraised value and requires a court hearing and potential overbidding.

Q5. How long does a probate sale take?
The overall probate process can last 12 – 18 months or longer. A property can sometimes be sold within three to four months under Full Authority, but Limited Authority sales often take longer due to appraisal, notice and court confirmation steps.

Q6. How is the sale price set?
Under limited authority, the property must sell for at least 90 % of the reappraised value determined by a probate referee. Under full authority, market conditions and comparable sales guide pricing; the representative must still act in the estate’s best interest.

Q7. Are probate sale proceeds subject to tax?
California does not have a state inheritance or estate tax. However, capital gains tax may apply if the property sells for more than its stepped‑up basis. Always consult a tax professional for advice.  A qualified real estate agent may provide a date of death valuation to assist in ascertaining this information. 

Q8. Can I avoid probate?
Creating a living trust allows assets to pass outside of probate. Proper estate planning can reduce delays and costs for your heirs.  Also, and very important: if an asset such as real property was left out of a revocable trust, before opening a formal probate,  the situation should still be analyzed to determine if the facts are appropriate for a more streamlined court petition known as a Heggstad Petition.  This so-called petition is done with the focus of having the court add the property as an asset of the trust.  

Marketing Considerations & Best Practices

Marketing a probate or trust property requires balancing fiduciary duties with achieving the best price.

1. Transparency & Disclosure – Provide buyers with a complete disclosure packet, including inspection reports and known defects. This can reduce contingencies and renegotiations.
2. Professional Presentation – Invest in staging, high‑resolution photography, twilight      photography and drone video to showcase the property. 
3. Digital  & Print Advertising – Listing promoted across the MLS, syndicated to major real‑estate  portals, social media, email newsletters and print brochures. 
4. Open Houses & Broker Tours – Host multiple open houses and broker previews  to expose the property to qualified buyers. Provide printed material  explaining the probate process, deposit requirements and timeline.
5. Flexible Showings – Because probate buyers may be unfamiliar with the process, offer flexible showing times and be prepared to answer questions. Clearly communicate whether the sale is subject to court confirmation.
6. Pricing Strategy – In limited authority sales, highlight that the property must  sell for at least 90 % of the appraised value. In full authority that means  quicker timeline and lack of court hearing.

Working with Professionals

Selling probate real estate involves legal, tax and marketing complexities. An experienced probate attorney has knowledge of court filings, notices and legal compliance. An experienced probate Realtor understands the marketing and disclosure requirements and can maximize the estate’s value. Appraisers and CPAs provide valuations and handle tax implications. As both a broker and an attorney, Derek Wagley combines legal expertise with brokerage skill, offering a streamlined experience for executors, trustees and attorneys as it pertains to the real estate portion.  While he will not provide you with legal advice (that is the attorney role), he will assist in you spotting the important issues that may surface during the pendency of the sale. 

Ready to Discuss Your Probate or Trust Sale?

Selling a probate or trust property can feel overwhelming, but you don’t have to navigate it alone. Derek M. Wagley, Esq. is a licensed real‑estate broker, California attorney and certified mediator with decades of Bay Area experience. Whether you need help interpreting full vs limited authority, preparing a property for sale or maximizing value for beneficiaries, Derek offers sophisticated guidance tailored to your estate’s needs.

Schedule a consultation today to discuss your options and timeline. Call 925‑451‑6679 or email dwagley@kw.com .  Derek will provide a confidential review of your situation and outline a customized strategy for your probate or trust sale.

Disclaimer: This resource is for informational purposes only and is not legal or tax advice. Always consult a qualified attorney and tax professional for advice specific to your situation.