Detailed Answer
In Virginia, decedents’ real property held solely in their name does not automatically become part of the probate estate for paying debts. A personal representative (executor or administrator) must follow statutory steps under Title 64.2 of the Code of Virginia to bring real estate into the estate, sell it, and apply the proceeds to claims.
1. Open Probate or Administration
The first step is to file the will (if any) or a petition for administration in the circuit court of the decedent’s last residence. The court issues letters testamentary (under a will) or letters of administration (intestate), appointing the personal representative with authority to manage estate assets.
2. Give Notice to Creditors and Interested Parties
Within 30 days after appointment, the personal representative must publish a notice to creditors in a local newspaper and send direct notice to known creditors. This triggers the statute of limitations for filing claims (Va. Code § 64.2-708).
3. Petition for License to Sell Real Property
To convert real estate into cash, the representative must petition the circuit court for a license to sell under Va. Code § 64.2-1300. The petition should include:
- Legal description of the property;
- Reason for sale (e.g., to pay estate debts);
- Names and addresses of heirs and devisees;
- Affidavit of the personal representative confirming due notice.
4. Obtain Court Order and Conduct the Sale
After a hearing—usually with at least 30 days’ notice to interested parties—the court issues an order authorizing sale. The representative must then market the property at fair market value, collect offers, and execute a binding sales contract. Some sales require court confirmation under Va. Code § 64.2-1301.
5. Apply Proceeds to Claims and Distribute Balance
Once the sale closes, the representative deposits proceeds in an estate bank account. Funds pay administrative costs (including commissions), funeral expenses, taxes, and creditor claims according to the statutory priority in Va. Code § 64.2-205. Any remaining balance then passes to heirs or beneficiaries.
Helpful Hints
- Verify ownership and lien status by ordering a title search early.
- Obtain a professional appraisal to support fair-market-value sales.
- Keep detailed records of all notices, filings, and court orders.
- Discuss potential tax implications of a sale with an accountant.
- Communicate regularly with heirs and creditors to prevent disputes.
Disclaimer: This article is for informational purposes only and does not constitute legal advice. Consult a licensed attorney about your specific situation.