Detailed Answer

This guide explains, in plain language, the common steps people follow in Arizona when they need court approval to sell a house and use the proceeds to pay off a mortgage. Situations that commonly require court approval include probate (selling a decedent’s real property as part of an estate) and protective proceedings (selling property of a ward or conservatee). Laws and local court practices matter, so read this as general educational information — not legal advice. For official Arizona statutes see the Arizona Revised Statutes (Title 14 — Trusts, Estates, and Protective Proceedings): https://www.azleg.gov/arsDetail/?title=14. For Arizona court self-help probate and protective proceedings resources, see the Arizona Judicial Branch: https://www.azcourts.gov/selfservice/Probate.

Step-by-step process (common in Arizona)

Identify the type of court proceeding.

Is there an open probate case for a decedent? Is there a guardianship or conservatorship (protective proceeding)? The path and paperwork differ depending on the case type. If no case exists, you normally must open one (for example, petition to admit will to probate or petition for appointment of a personal representative or conservator).
Confirm who has authority to act.

In probate, the personal representative (executor/administrator) acts for the estate but usually needs court authorization to sell real property. In a protective proceeding, the guardian or conservator must often get court permission before selling a ward’s real estate. Review any will, court letters of appointment, or prior orders that may already grant sale authority.
Get basic valuation and mortgage payoff information.

Obtain a market valuation (comparative market analysis or appraisal) and request a payoff statement from the mortgage lender. The lender’s payoff amount and any prepayment penalties affect whether the sale will clear the mortgage and what net proceeds will remain for the estate or protected person.
Prepare and file the required petition or motion.

Prepare a written petition or motion asking the court to authorize the sale. Typical requests include authority to market and sell, approval of sale terms, ability to pay off the mortgage from sale proceeds, authority to sign closing documents, and permission to pay closing costs and agent commissions from the proceeds. Submit any required supporting documents such as the appraisal, copy of the deed, mortgage payoff statement, and a proposed order.
Provide notice to interested parties and creditors.

Arizona courts require notice to interested persons (heirs, beneficiaries, creditors, and sometimes next of kin). You may need to serve parties individually and publish notice in a newspaper in some cases. The court will specify the notice form and timeline. This gives creditors and heirs the opportunity to object.
Attend the court hearing (if required).

The court may set a hearing. At the hearing the judge will review the petition, any objections, the proposed sale terms, and whether the sale is in the estate’s or protected person’s best interest. If the court is satisfied, it will sign an order authorizing the sale and specifying any conditions.
Complete the sale according to the court order.

Market and sell the property. The buyer’s closing will proceed like a typical real estate closing, except the closing agent will often require a certified copy of the court order and letters of appointment. The mortgage payoff statement is used at closing to pay the lender from sale proceeds.
Distribute proceeds, file receipts and final accounting.

After closing, use the sale proceeds to pay the mortgage, closing costs, taxes, and authorized fees (including any court-approved commissions). The personal representative or conservator typically files a reconciliation or final accounting with the court that shows sales proceeds and payments made from them.
Record documents and get lender release.

Record the deed or deed of distribution as required. Ensure the lender records a satisfaction/release of mortgage in the county recorder’s office once paid off. Keep recorded copies in the court file and estate/protective proceeding records.

Common Arizona-specific considerations

Probate vs. non-probate: Property that passes outside probate (e.g., joint tenancy, community property with right of survivorship, or beneficiary-designated accounts) may not require probate sale procedures. Confirm title status early.
Bond and court supervision: The court may require a bond for the personal representative or conservator, or may require court supervision and accounting. Check the letters of appointment and local rules.
Creditor claims and timelines: Probate and protective proceedings include timelines for creditor claims. Selling without proper notice or before claims expire can create risk. See general Arizona probate laws: Arizona Revised Statutes, Title 14.
Lender requirements: Lenders often require specific documentation (court order, death certificate, letters testamentary/letters of administration) before issuing a payoff or releasing a mortgage.
Local court procedures: Each Arizona county may have local probate rules and required forms. Check the Arizona Judicial Branch probate resources: https://www.azcourts.gov/selfservice/Probate.

When objections or complications arise

If heirs, beneficiaries, or creditors object, the court may schedule additional hearings. Disputes can delay sale or require the court to set conditions (such as overbidding procedures or escrow holdbacks). If the mortgage balance is greater than the likely sale price, the estate or conservator may need the court to authorize a short sale or refinance strategy and possibly evaluate whether selling is in the best interest of the estate/protected person.

Helpful Hints

Start by identifying whether the property is inside or outside probate. That determines whether you likely need a court-filed petition.
Contact the mortgage lender early for a payoff statement and to learn their documentation requirements for release of lien.
Get a market valuation (agent CMA or appraisal) to set price expectations and to support the petition to the court.
Use the court’s forms and follow local rules. Arizona Judicial Branch self-help pages include probate and protective proceeding forms and instructions: https://www.azcourts.gov/selfservice/Probate.
Keep careful records of notices, filed pleadings, sale documents, and all distributions. The court will expect clear accounting.
Expect timeline and costs: court fees, publication costs, appraisal and closing costs, possible bond premiums, and attorney fees can reduce net sale proceeds.
Consider speaking with a probate or guardianship attorney early—especially if there are disputes, multiple heirs, substantial mortgage debt, or complex title issues.

Disclaimer

This article is for general informational and educational purposes only. It does not constitute legal advice and is not a substitute for consulting a qualified attorney in Arizona who can evaluate your specific facts and advise you of your legal rights and obligations.