Losing a loved one is always a difficult experience. Processing your grief is an extreme feat in itself; one that is exacerbated by the responsibility of managing an estate in the midst of heightened emotions. 

Probate, or the legal process of analyzing the will and distributing the assets of a deceased person, is likely the last thing you want to think about when you’re grieving. However, it’s a necessary step that will allow you to carry out the final wishes of your loved one. 

For assistance during this process, many people choose to hire a probate lawyer. Read on to learn more about probate lawyers and find out if you should hire one to guide you.

What is a Probate Lawyer?

Probate lawyers—also known as probate attorneys—are legal professionals who are specially licensed to guide the executor or beneficiaries of a will through the process of settling the estate. They may represent a beneficiary of the will or work on behalf of the estate itself. 

If you choose to hire a probate lawyer, they’ll assist you in a number of ways throughout the legal proceedings. This includes things like taking inventory of estate assets, paying estate debts and facilitating the distribution and settlement of estate property. 

Probate lawyers may also be involved in the estate planning process, in which case they’ll take on key roles such as creating a will and setting up guardianships or trusts. However, these services often come with added fees, so it is common for attorneys to work with families exclusively to settle the estate.

While legal proceedings such as probate can often be complicated in their own right, grief can make the process seem nearly impossible to work through. Aside from providing key services and information, probate lawyers are often invaluable simply for the fact that they’ll shoulder the legal burden, allowing you the space you need to heal. 

The Difference Between Probate and Estate Planning Lawyers

If you plan to hire an attorney to help you through the probate process, it’s essential to understand the difference between probate and estate planning lawyers. 

Estate planning lawyers work exclusively to organize a person’s estate before their passing. They’ll supply services such as drafting a will and helping to select the right executor. 

On the other hand, probate lawyers work to organize an estate after the person has passed. While a probate lawyer can double as an estate planner, their expertise lies in administering a will and facilitating the distribution of assets among beneficiaries. 

What Does a Probate Lawyer Do?

Once someone passes, their estate assets must be divided as stipulated within their will. Most states have strict laws when it comes to facilitating a will, which can be difficult to understand if you aren’t already familiar with them. For this reason, probate lawyers are often necessary to organize an estate while adhering to state regulations. 

A probate lawyer will assume responsibility for a wide range of tasks. Some of these services include:

• Collecting life insurance policy proceeds
• Determining the cost of inheritance taxes and paying them
• Determining and paying both estate and income taxes
• Identifying all estate assets and conducting any necessary appraisals
• Distributing assets once bills and taxes have been paid
• Opening and managing a checking account for the estate
• Settling all debts and outstanding bills
• Preparing and filing all legal documents
• Retitling assets in beneficiaries’ names

If the estate of the deceased person had been placed in a trust before their death, there will be no need to go through legal proceedings to distribute assets. In this case, you may not even need to go through probate, though a probate lawyer may still be able to give you valuable guidance. 

By taking on responsibility for such a large number of services, probate lawyers often prove to be an essential resource for those who are dealing with the death of a loved one; particularly if you are inexperienced when it comes to managing an estate plan.

The Cost of Hiring a Probate Lawyer

The cost of hiring a probate lawyer will vary based on a variety of factors, including the state you live in and the size of the estate. Some lawyers charge a flat fee for their services, while others charge an hourly rate. 

Some states allow probate lawyers to charge a percentage of value fee, meaning their cost will vary depending on the value of the estate. Currently, seven states permit this kind of charge, including:

• Montana
• Missouri
• Wyoming
• Iowa
• Florida
• California
• Arkansas

For example, if the estate in question is located in Florida, the percentage of value fees look like this:

• $1,500 – $3,000 for estates valuing between $40,000 and $99,999
• 3% for estates valuing between $100,000 and $900,000
• 2.5% for estates valuing between $1 million and $3 million
• 2% for estates valuing between $3 million and $5 million
• 1.5% for estates valuing between $5 million and $10 million

Percentage of value fees also vary from state to state. For those in California, these fees look like this:

• 4% for estates valuing up to $100,000
• 3% of the next $100,000
• 2% of the next $800,000
• 1% of the next $9 million
• 1.5% of the next $15 million
• A “reasonable percentage” for estates that value over $25 million

Do You Need a Probate Lawyer?

Deciding whether or not to hire a probate lawyer can be a tough decision. If you’re already familiar with the probate process, you may be able to manage the estate on your own. However, there are some cases where the knowledge that a professional can bring will prove invaluable. 

Here are some situations where it’s a good idea to turn to a probate lawyer for help. 

When There is No Will

A study conducted by AARP found that 60% of Americans lack adequate will or estate planning. That shocking number is expected to rise even further, as younger Americans become less and less inclined to develop an estate plan. 

If your loved one passed without writing a will, their wishes and stipulations will not be taken into consideration during the estate settling process. Instead, assets will be divided according to state laws, which vary greatly. 

In these cases, a probate lawyer can still be hired to assist the administrator of the estate. They will still perform all of their regular duties, simply adhering to state rules rather than the stipulations of a will.

When There is a Will

The probate process can be challenging to manage even if your loved one has left a will behind. While you’ll have the stipulations of the will to guide you, it may be hard to keep track of necessary payments while distributing assets and adhering to state regulations. 

Probate lawyers are valuable partners to have in these cases. A probate lawyer will analyze the will, handle necessary payments and distribute assets so you don’t have to. In tense times of grief, these services can give you a brief respite to the process of settling an estate. 

For Large Estates

Even if you’re already familiar with the probate process and laws within your state, large estates can make things complicated. If there are numerous debts to settle and assets to distribute, hiring a probate lawyer is the easiest way to navigate the process smoothly. 

To Handle Beneficiary Disputes 

Unfortunately, not every family gets along without issues, especially during times of heightened emotions. Luckily, there is a way to settle an estate while keeping tensions low. A probate lawyer will act only on behalf of the deceased and can guide you through the process in a matter than is fair to all beneficiaries. 

Selling a Home After Losing a Loved One

It’s common for beneficiaries to inherit a home after their loved one has passed. Though it is an emotional decision to come to, most heirs choose to sell the home for numerous reasons. 

In many cases, these homes become an additional hassle for the grieving family—especially if they are old and in need of significant repairs. Additionally, many people do not have the financial means to manage an additional home and will benefit more greatly from selling it. 

Luckily, there is a way to rid yourself of an unwanted home fast, no matter how many repairs or upgrades it needs. With iBuyer, you can access a group of buyers and investors who are ready to buy your home quickly. To get started, simply use the free home appraisal tool to find out what your property is worth, and wait for the offers to come in. 

Enter your address today and take the next step in your journey toward healing from grief. 

The post Probate Lawyers: What Are They & Do You Need One? appeared first on iBuyer Blog.

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Selling your home can be a stressful process. From finding the right buyer to ensuring you’re getting the most for your house, there’s a lot to manage as a seller. 

Throughout the process of selling your home, you’ve probably heard the term “seller credit.” As a seller, you may balk at the idea of offering any buyer a credit for your home. But while seller credits may seem irrelevant at first, there is often more to them than meets the eye. You might find that a seller credit can get you the offer you’ve been waiting for.

Read on to learn more about seller credits, and find out if offering one to your buyer is really a good idea. 

What is a Seller Credit?

At their most basic, seller credits are money the seller gives to the buyer at closing. 

This may seem counterintuitive to the needs of the seller, but in fact, seller credits are actually powerful negotiation tools. In many cases, a seller must introduce an incentive to the buyer in order to guarantee the completion of the sale. Whether it’s to cover the cost of repairs or lessen the blow of closing costs, seller credits can keep the deal from falling through right at the end of the process. 

Though you may be unfamiliar with seller costs, they are actually an extremely common negotiation tactic used by homeowners across the country. The National Association of Realtors estimates that around 46% of sellers used financial incentives to entice a buyer in 2020. 

Whether or not you’ll need to offer a seller credit depends on several factors, the biggest of these being local market conditions. If you’re in the midst of a seller’s market you may not need to utilize seller credits, as the buyer will likely be competing with other offers. 

What Seller Credits Cover

Seller credits essentially cover part or all of the buyer’s closing costs. However, this can vary slightly. As a seller, you may be asked to pay for a specific part of the closing costs, or simply a percentage of the total. 

Here are some closing costs your seller credit may be used to cover:

• Property taxes
• Loan origination fees
• Inspection fees
• Title insurance
• Appraisal fee
• Recording fees
• Attorney’s fees
• Cost of repairs
• Mortgage points

When Are Seller Credits Necessary?

As a seller, you may be hesitant to offer a seller credit. However, there are some cases where offering a seller credit can benefit you; mainly in the form of moving the deal forward. 

Here are some of the most common scenarios that drive sellers to offer credits to their buyers. 

To Offset Costs Repair Costs

Home inspections can often give buyers the upper hand in the negotiation process. No matter how small, necessary repairs may make your buyer hesitate—especially if your deal includes a home inspection contingency that could allow them to walk away.

Unfortunately, simply offering to repair the issues yourself can be a major hassle. From expensive contractor fees to long wait times, you could wind up extending your closing time by weeks, or even months. 

For a quicker closing without losing your buyer, a seller credit may be your best option. Rather than agreeing to complete the repairs on your own, you can offer the buyer a repair credit that will be given to them at the time of closing. This way, you can enjoy a simple closing process without the hassle of making repairs. 

To Entice a Hesitant Buyer

If your home has been on the market for months without any leads, it’s easy to feel desperate for the process to be over. In these cases, you’ll likely consider dropping the price of your home. 

Lowering your listing price can do more harm than good, as prospective buyers may see it as evidence of an issue with your property. Instead, adding a seller credit to the listing price allows you to stand by your initial price while attracting buyers with the idea of saving on closing costs. 

If you’re in the middle of a seller’s market, you likely won’t need to introduce a seller credit to entice a buyer, largely because they will most likely be competing with other buyers to purchase your home. 

To Assist the Buyer with Closing Costs

So you’ve found a buyer for your home, and their final offer comes in at the top of their budget. While they still qualify for their mortgage, they may be short on cash at closing time. 

Luckily, you can keep the deal from falling through with the help of a seller credit. Simply raise the sale price of your home and offer the buyer the difference as a credit. This lowers the amount they’ll need for closing while allowing you to sell your home quickly for the agreed-upon price. 

To Speed Up the Closing Process

In some cases, selling your home is a time-sensitive process. Whether you need to be in your new home quickly to start an out-of-state job or want to have your family settled in time for school, you might need to sell your home as quickly as possible. 

This is where seller credits come in. To entice buyers quickly, you can add certain incentives to your listing. Things like one-year home warranties, natural disaster insurance or flood insurance can give your home an edge over the others in your area. Rather than directly paying for these policies, simply give the buyer a credit of equal value at closing. 

Seller Credit Limits

Seller credits are not without their limits. How much you can offer as the seller will depend largely on the buyer’s loan type.

For example, if your buyer has an FHA loan or a USDA loan, you’ll be able to contribute up to 6% of their loan amount. If they have a conventional loan, the amount you can contribute will depend on the size of their down payment (with a maximum contribution of 9%). 

Seller credit limits are enforced mainly to discourage inflation in the housing market. While astronomical credits may make for an easy sale, over time they’ll cause home and rent prices to rise to unsustainable levels. 

Seller Credits: The Pros and Cons

When it comes to seller credits, there are advantages and disadvantages to offering them. Whether or not you should offer one will depend largely on your needs as a seller and the state of your local market. 

Before you make your decision, here are some of the pros and cons of seller credits. 

Advantages of Seller Credits

In a buyer’s market, seller credits can give you a necessary edge over your competition. They’ll also help you overcome barriers such as expensive repairs, making them a powerful negotiation tool. 

Seller credits are also useful if you need to sell your home as quickly as possible. They can incentivize buyers to make an offer quickly, and even prevent your deal from falling through if a buyer has trouble paying closing costs. 

Disadvantages of Seller Credits

However, there are some disadvantages you should look out for as a seller. Agreeing to raise the home’s sale price and offer a credit may help your buyer save on closing costs, but there is some risk associated with this kind of deal. 

If your home does not appraise at a higher value, the buyer may be forced to cover the difference out-of-pocket at closing, effectively negating the benefits of your credit. Additionally, closing fees may fluctuate unexpectedly. If you’ve agreed to pay a percentage of the closing costs, a rise in fees may lead you to pay more than you planned.

Who Really Benefits From Seller Credits?

The bottom line is this: seller credits can benefit both you and the buyer. 

If you’re struggling to sell your home it may be a good idea to utilize a seller credit as a way to add value without lowering your listing price. Credits also come in handy when you need to offset additional repair costs that present themselves after an inspection. Plus, they are an easy way to speed up the process of selling your home if you’re working to meet a deadline. 

However, seller credits can be a hassle in their own right. If you’re currently experiencing a seller’s market, offering a credit will simply complicate the process of selling your home. In these cases, you’re better off allowing buyers to compete with one another. 

Get the Most for Your Home With iBuyer

If you’re looking to sell your home fast, there is a way to get the most for it without resorting to seller credits. With iBuyer’s help, you can expose your home to local buyers and investors who are looking to buy quickly. 

Selling your home with iBuyer is easy. Just use the free appraisal tool to get your home’s value, and wait for your offer to come in. Submit your address today and take the first step toward selling your home fast. 

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