Acting as an Executor for a loved one is a big responsibility – one that you will often be tackling as you’re navigating the grieving process at the same time. One of your biggest responsibilities will be selling their assets which comes with some unique challenges. So if you find yourself selling an estate home, we wanted to make it as straightforward as possible with this Executor’s Guide.
When tasked with being an Executor, there’s nothing simple about administering someone else’s assets, especially if they include a property. Hopefully they’ve been organized with their personal documents so you have a good starting place – but all too often paperwork is misplaced making the Executor’s job even more befuddling. So let me try to make this as simple as I can. First off, I’m a REALTOR® and can only speak to my experience representing sellers of an estate home. I can’t offer legal advice, so my first tip is to definitely talk to a lawyer about the legalities of being an Executor. I can only guide you on what you’ll need to consider as you navigate this home sale transaction, and hopefully we can make it a smooth one!
First things first…
More than likely, the largest assets you will be dealing with are the decedent’s primary home, cottage and/or vacation property. Before anything else, you should make sure:
- The property is locked and secure as it may be vacant for some time.
- Ensure you have a working set of keys and alarm code if applicable. You may wish to figure out who else has keys and access to the property.
- Verify that the home is insured, again, as it may be sitting vacant.
- Check on the property regularly to ensure there are no burst pipes, the furnace is still running, etc.
Even just getting these basic things figured out can go a long way to making this an easier time.
File for Probate
Confirm if Probate is required. In Ontario, probate is often necessary if the deceased person owned real estate, but you can check with your lawyer to determine what is necessary.
Essentially, Probate is when the courts verify that the Decedent’s will is in fact valid, and that you will be officially acting as the Executor to their estate.
In most cases, you will need to file for, and attain the Probate Certificate before you can firmly sell the estate home. This can take anywhere from 6-8 weeks (or longer, depending on the municipality you live in). So if you choose to list the home before Probate is complete, you may have to delay the closing date of the sale until after you’ve gotten this certification.
What if they didn’t have a valid will naming you as Executor? Probate will take much longer, as the courts need to decide who should control all the assets in accordance to Ontario’s Succession Law Reform Act. You will need to apply to the court to ask if you can have the authority to administer the estate. So bear this in mind before you stick a For Sale sign on the front lawn!
Get a proper Evaluation or Appraisal done
Assuming Probate is all taken care of and you’re ready to start the home selling process, you should start by getting an unbiased appraisal or evaluation of the home.
It’s in everyone’s best interests if you sell the property for Fair Market Value – this can create friction in some families, especially if one beneficiary is interested in purchasing the property from the other beneficiaries. Unless all beneficiaries agree to sell to them at a lower price, you’ll need to abide by the “fair market price” rule.
You may wish to have The Kate Broddick Team give you a Free Home Evaluation so you have an indication of what the home could sell for, when compared to other recent sales in the neighbourhood of similar homes. We will do our homework and back it up with comparables and market research so you can be confident in what we are suggesting would be a fair price for the home.
Keep accurate records
Remember, as the Executor you need to meet your fiduciary duty. Acting in the best interest of all beneficiaries and treating them equally is your number one priority. That’s why it’s so important to maintain records and get professional opinions on the sale of the home. Every beneficiary is going to have their own opinion on whether you’re selling the home for too little, for too much, or if you’re giving preferential treatment to one of them over the other.
You don’t want any of the beneficiaries to take a process known as “the passing of accounts” – where they can ask the court to formally review your actions. So ensure that you’re keeping copies of everything: when a REALTOR® gives you their opinion of value on the home, file it away and perhaps get a few more market analyses so you can show that you’ve gone above-and-beyond to ensure fair market value on the home.
Communication is key! Make sure you’re keeping the beneficiaries informed of the process and they’ll appreciate it even more through this difficult time.
Sorting and Staging the home
Starting the process of cleaning out the home can be an emotional time for family members, so go easy. Being present and leading the family through the sorting of loved one’s belongings is a big responsibility. Your duty as the Executor is to ensure all belongings are distributed as per the Decedent’s wishes. And if there were no instructions on who should receive the full set of china, or the antique chair in the living room, you must find a way to distribute things fairly. This is not always easy and you may wish to have the lawyer get involved to ensure everyone walks away feeling like a compromise was met.
As your REALTOR® we don’t necessarily recommend clearing out the whole home entirely so it is bare for the sale. Instead, cleaning and organizing each room with a reasonable display of furniture usually makes the house feel more welcoming to buyers. Check out our blog on Tips For Selling A Home When It’s Vacant .
Paperwork needed & tax implications
As with almost everything you do as the Executor of an estate, you will need to ensure you have a copy of:
- the signed will from the Decedent, outlining you as the Executor
- the Probate Certificate verifying that the will is certified valid
- a copy of the death certificate from the funeral home
Once the home has sold firm, be aware that there may be capital gains taxes. These are the taxes that are charged on any “gains” the home made in value from the time that it was purchased to the time that it was sold. Generally these will be dealt with at the next tax-time of year, but speak to an accountant to discuss how much these capital gains taxes may be.
Selling a family or a loved one’s home can also be a very emotional time. As the Executor you’ve committed to undertaking this large job for your loved one and ensuring their final wishes have been fulfilled. With the proper advice from lawyers, accountants and your REALTOR®, they can help you work through the legalities of the sale, as well as working tirelessly on your behalf to make sure that the best outcome is achieved and your responsibility to the estate is fulfilled.
If you’re selling an estate home in Hamilton, Kitchener-Waterloo, Norfolk or the Brantford Real Estate Market, please give our Team of Real Estate Agents a call. We are ready to walk alongside you in this journey.