When one winds up in probate court, there is one saving grace: the Independent Administration of Estates Act (IAEA). This Act is quite helpful to executors because it permits them to take care of estate issues without obtaining formal approval from the probate court. This means fewer court appearances, calls, and less documentation in administering the estate.
One operational feature of the Act is that an executor may request the court’s permission to sell real estate in the will without typical court supervision. In probate, the disposal of real estate requires a court-directed appraisal be completed. Then, for the property to sell, a buyer must submit an offer within 90% of the real estate’s appraised value. This can pose difficulties especially in rural areas where appraisals are more likely to overestimate the market demand for property.
Complicating matters in this arena is that any interested party may petition the court to deny the executor’s IAEA application. Before making the request for limited supervision to the court, an executor should consider whether it is likely that a beneficiary will object to the executor’s selling of the real estate.
The Independent Administration of Estates Act also governs an executor’s ability to acquire loans taken out against real property.
An executor with full authority to administer the estate without court supervision still has to notify heirs, creditors, and beneficiaries of his or her intent to transfer real property. Those interested parties may lodge objections with the court after receiving notice.
For more information on the Independent Administration of Estates Act and how to avoid the probate process, please contact us at (626) 696-3145.
