Buyers can be motivated to buy property from a deceased estate as it is usually perceived to be good value.
It is important however that before entering into such a Contract that it refers to the correct seller; which may not always be the name on the title at the time of entering into the contract. If this is not correct the contract may be invalid.
The deceased’s name must be removed from the title and transferred into the personal representative’s name or surviving joint prior to settlement. This may not always be the case at the time the contract is signed. Nor does it have to be. So long as those things are taken care of before settlement then it will be ok.
A grant of Probate or Letters of Administration may be required in order for the property to be transferred however. This process can be fairly lengthy; therefore it is generally preferred to have this done prior to entering into a Contract of Sale, alternatively clauses must be inserted into the contract to make it conditional upon those things being completed.
The timeframe for registering the property into the name of:
1. a surviving joint tenant can generally takes up to a week (longer if a mortgage is registered on title); and
2. an Executor/Personal Representative can be up to three (3) months depending on the stage of the application for Probate or Letters of Administration if required.
As a Buyer it may be worth considering a longer settlement to ensure the registration is completed. Sellers in this case should also make sure the contract subject to the registration so that the contract can be terminated if there are unforeseen delays.
If you have any hesitation, please contact us to carry out a review of the Contract and provide you with relevant legal advice in relation to same.
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