Detailed Answer — who gets paid first and how to locate the destination of sale proceeds

When a house owned by your father is sold, the path the sale proceeds take depends on how the property is owned and whether your father’s estate is being administered. Below are the typical scenarios and the usual order of payments under Indiana practice.

1) Determine ownership and authority to sell

Start by finding the deed. The deed tells you how title was held:

• If the deed shows ownership in your father’s name alone, and he is deceased, the house usually becomes part of his probate estate (unless a trust or transfer-on-death deed applies).
• If the deed names a living trust, a trustee can sell the house and distribute proceeds according to the trust document.
• If title was held jointly with right of survivorship (e.g., jointly with a spouse), the surviving co-owner typically owns the house outright and sale proceeds go to that co-owner.
• If there is a transfer-on-death deed or beneficiary deed, the beneficiary receives the property outside probate and the proceeds go to that beneficiary.

Where to check: the county Recorder’s office where the property sits holds the recorded deed and any beneficiary deed or trust documents that have been recorded. You can find county office links through the state county directory: Indiana county offices.

2) If the property is part of a probate estate

If your father died owning the house in his name and the estate is opened in probate, the proceeds from a sale will usually go to the estate. The executor (also called personal representative or administrator) must use the proceeds to pay the estate’s obligations first and then distribute any remainder to beneficiaries under the will or under Indiana intestacy rules if there is no will. Indiana probate law governs the process: Indiana Code—Title 29 (Probate).

Typical priority of claims against sale proceeds (common in Indiana probate practice):

1. Costs of sale and closing costs (title fees, commissions, escrow fees).
2. Mortgages and other perfected secured liens on the property — the lender(s) are paid the payoff amounts first.
3. Property taxes and tax liens (county and federal tax liens if any).
4. Court-ordered expenses, funeral expenses, and administrative expenses (executor fees, attorney fees, probate costs).
5. Other creditors with allowed claims against the estate (unsecured creditors) according to the probate claims process.
6. Remaining net proceeds are distributed to beneficiaries under the will or under Indiana’s intestacy rules.

Where to check: look for the probate case in the county where your father died or where he lived. The probate court file will include the inventory, accounting, creditor notices, and any court orders about sale and distribution. The Indiana Judicial Branch explains probate basics here: Indiana Judicial Branch — Probate.

3) If the property is in a trust

If the house is owned by a revocable living trust, the trustee handles the sale and distributes proceeds according to the trust document (outside of probate). Request a copy of the trust or a trustee’s statement. Trustees must follow the trust terms and applicable duties under Indiana law. See Indiana property and trust provisions at Indiana Code—Title 32 (Property & Trusts).

4) If someone had power of attorney or guardianship

If a power of attorney (POA) was used to sell the home while your father was alive, the proceeds should have been handled according to the POA’s scope (and applicable fiduciary duties). If a guardian was appointed for an incapacitated person, the court supervises sales and distributions. Review the POA or guardianship court records for authorization and accounting.

5) Title/closing procedures — how buyers’ closing statements show distribution

At closing, the title company or closing attorney prepares a closing statement (HUD-1 or similar) that itemizes how gross sale proceeds are applied: payoff to mortgage(s), lien payoffs, closing costs, seller credit, and net to seller or escrow. Ask the closing agent for the closing statement. If the estate sold the house under a court order, the closing may send net proceeds to the estate’s bank account or to the court registry pending distribution.

6) Practical checklist: how to find exactly where the proceeds will go

1. Get the recorded deed from the county Recorder to see how title was held.
2. Ask the person handling the sale (seller, trustee, executor, realtor, or closing agent) for a copy of the contract and the anticipated closing statement or payoff instructions.
3. Check whether a probate case or trust administration is open. Search county probate court records or contact the probate clerk.
4. Request a title report and lien search from the title company. The title report lists mortgages, tax liens, and other recorded encumbrances.
5. Check county tax records and the county Treasurer for unpaid property taxes and tax sale information.
6. Search the county Clerk’s office for judgments and contact the county Recorder for any recorded liens.
7. If you suspect federal or state tax liens, contact the IRS and Indiana Department of Revenue; federal liens are searchable through IRS notice or by asking the closing/title company for a lien search.
8. If the sale is through probate or by a fiduciary, request the court filings or a court-ordered accounting showing who will be paid and in what order.

7) If you still can’t find out where money will go

If records are unclear or parties disagree, you can:

• Ask the executor/administrator or trustee in writing for a written accounting showing payoffs and planned distributions.
• Ask the closing/title company for the final closing statement (settlement statement) — that document shows exact disbursements.
• If the estate is in probate and you are an interested person (heir or creditor), you may petition the probate court for an accounting or to compel information.

Because Indiana probate and property laws set the framework for who gets paid and in what order, see the state law titles linked above for statutory background: Title 29 (Probate) and Title 32 (Property).

Helpful Hints — steps you can take right now

• Locate the deed at the county Recorder’s office to confirm ownership and any recorded beneficiary deed or trust.
• Ask the closing agent for the preliminary and final closing statements — these show exact disbursements.
• If there is a probate case, review the court file for the petition to sell, inventory, and any court order about distribution.
• Request a title/lien search from a title company; it lists mortgages, liens, and encumbrances that must be paid from sale proceeds.
• Check county records for judgments and county tax records for unpaid property taxes or tax liens.
• If you are an heir or beneficiary, request written accountings from the executor or trustee and keep records of all communications.
• If you suspect improper handling of proceeds, you can ask the probate court for an accounting or file a motion to compel distribution.
• Keep copies of all closing documents, payoff statements, and any court orders — they provide the clearest record of where money went.