As an investor, you are always on the hunt for properties you can buy at cheap rates. Property flipping is a lucrative investment; it gives you the opportunity to earn a huge profit on comparatively lower investments. If you know how to flip houses in Texas, you know that securing cheap real estate is the first step.
In this article, we will look at the ins and outs of the fix-and-flip- from finding real estate leads to closing deals with prospective buyers.
What is a probate property?
A probate is a process completed when a decedent leaves assets to distribute such as banks, accounts, real estate and financial investments. The probates are Real estate leads which are examined and rolled out by the court-appointed executor of the state, the person, who was named in the will to distribute and close the estate. Apart from the executor the probate court can act as a facilitator of these properties.
Why are probate properties lucrative to fix-and-flip investors?
Who likes a cheap investment and a hefty return rate? What could be better than that of a probate property? Listed below are reasons why these probate properties are lucrative.
I. Beneficiaries may not want the home.
The beneficiaries of probate properties don’t always want to own a property. This is a great probate real estate lead. They are also aware they would need to pay the taxes of that property. For this reason, they would be willing to sell this property for cheap to seasonal flippers and if not anything then some monetary benefits out of it.
This was one side of the coin, on the flip side, there is another, which is the willingness to deal with the estate management. Another, reason of getting rid and transferring of these properties is that once the responsibility stands shifted, all onus shifts on the person buying it. So new buyer pays for the estate at large. (You are free)
II. Burden of debt
This is rather complicated with probate properties. Since the owner is deceased, it is not the next of kin who can pay, but, the executor would be paying off the debt. For example, if the owner had a debt of $700,000, the executor would sell the property at an appraised value and pay off the debt (This is an exceptional case). In most cases, the property is sold off at a lower price than that of its market’s price. This facilitates the executors to convert their real assets to cash quickly.
III. A great choice for flipping
Flipping probate properties can be a great choice, there can be frequent repair costs, property management costs, and maintenance which can also recur, making it difficult for the property, owner to maintain daily. All these factors assimilated together, can help in making these properties a perfect probate Real Estate Lead.
How to find leads for probate properties?
In this section, we shall join dots in connecting some dots and get some genuine probate leads for flipping houses in Texas.
A. Public Records
Requires absolutely no-to- little time and effort, one effective way to find probate leads,is to get them from a probate list which appears in public records and probate leads in the courthouse. There are several probate cases filled in the country courthouses, they make it public, and make use of these. In case it is sensitive or restrictive consider visiting the court to get access to physical files. The next process follows all the steps that we know, you visit the place see the options and pick the one which suits your style.
B. Buy it from probate leads.
Real estate investors can further buy probate leads and this option is a little on the heftier side, bound to pinch your pockets. There are several subscription fees and limited, access depending on your preferred state and county. However, these online lead providers digitise and amplify access to the information about probate leads for real estate professionals, segregated by cases filed and assigned counties.
C. Obtain referral probate leads.
Acquiring referral leads is one of the best probate Real Estate Leads. They are usually lowered in price and are usually provided by friends and families or colleagues, connect with your social circles or inquire within your family and friends for any probate Real Estate Lead that they know. By telling your sphere of influence that you are interested in the probate opportunities they know to refer such information to you.
D. Consult a probate attorney.
Just the we have a fitness consultant, there is also a real estate consultant, who can help you with real estate advice and consultations. They are the perfect person to visit if you want to know how to Flip Houses in Texas, by preparing legal documents required for the probate court, they help you to build up a will, for the ones who are recipients of the deceased.
Apart from these services, the responsibilities of a probate attorney, from finding the inventory assets of the estate, understanding, and paying the debts, the estate may have, distributing and selling the estate and more.
E. Market yourself as a probate investor.
If purchasing a probate property is the majority of the business model, then two things are clear, first could be a potential seasonal flipper, and you can get the best probate real estate leads.
As a professional flipper, you can create marketing materials that will help you to drive your business like landing pages, client testimonials, exclusive listings, calls to action IDX feed and search, and lead generation web forms.
f. Collaborate with a certified probate specialist.
Collaboration for promotional business is an effective way to generate leads. These are Certified probate real estate specialists or CPRES who work with families involved with the probate process. They are trained to understand the nuances of the probate court systems and help them in understanding legal steps and upcoming deadlines.
G. Auctions
Once a property is ready for sale probate will typically be auctioned off for a quick sale or order by a judge. They can be primitive, but it gives you a reality check. This is a public display. All the listed probate listing is put up and ready to be disclosed and sold off. Before the deal is closed a cash deposit of 10% of the total amount has to be deposited.
Legal considerations for buying probate properties
In this section, we shall shed light on legal advice and considerations that should be taken before the sale and deal of probate properties.
1. Outstanding debts- one should be aware that there are no outstanding debts on the property, if the deceased owner has any unpaid mortgage or loans, these should be cleared.
2. Inheritance laws and rights- it is important to research and consult a legal professional about the specific laws.
3. Pay close attention to tax obligations: This may differ from country to country. The most common are inheritance tax and capital gains tax. Understanding these laws can save you from unexpected financial burdens after the purchase.
Process of fixing and flipping a probate property
Below is listed a step-by-step process that can help you fix and flip a probate property.
1. Filing- begin by fixing and filing for a probate initiating application where. This has to be done in the county where the person lives. After this, you would have a 10-14-day waiting period, before the hearing of this application.
2. Hold a hearing: Once your waiting period is over, a probate judge holds a hearing where the court legally recognizes the death. If there is no fixed will, the court will execute or administer the estate. Within 20 days the oath of office is secured the bond as and when needed.
3. Notify the creditors and beneficiaries: there would be news printed in the paper, and there shall be a creditor who can make a claim. The executor will either accept or reject the claim within 30 days. Post this the beneficiaries would also be informed within 60 days and 90 days of an affidavit that all heirs have been notified.
4. Asset inventory: Within a span of 3 months of 90 days the executor is required to catalogue the estate assets. There would be a thorough investigation of the Inventory swearing that here are no unpaid unsecured debts and that all estate beneficiaries received a copy of the inventory.
5. Resolving and distributing assets: The estate cannot be finalized if the potential beneficiaries’ contest the will and file related grievances. Any relational complaints can be filed within two years of the original probate. Once there are all clean chits given by the estate governors and executors – with all debts cleared, the properties can be distributed among the beneficiaries.
Conclusion
Probate properties offer house marketers and real estate investors a supplementary market funnel and set the framework for house flipping. Before moving ahead with generating probate leads, it is essential to educate yourself on the nitty-gritty. From laws to leads, there should be awareness at every level on how to flip houses in Texas. This guide will help you to understand all the whereabouts of flipping a probate property.
