Prior to selling Los Angeles real estate, I was in mortgage banking. I held a variety of positions and at one point I was a loan officer at Los Angeles Federal Savings Bank. In this position, I was required to have a real estate license. During the 1980’s each bank I worked for was being acquired by larger institutions. At that time the consensus in the banking industry was that Great Western and Home Savings would survive… how wrong we were.
In 1989 I decided to switch careers and began selling real estate. The real estate market crashed and as I had extensive lending experience and a banker’s mindset I decided to focus on foreclosures. I worked for Freddie Mac, Fidelity Federal, California Federal and Coast Savings Bank.
The California real estate market is cyclical, and after working with foreclosures, and standard sales (regular buyers and home sellers like you and me) I decided to branch out and also focus on probate and trust sales. I currently work with a handful of probate and trust attorneys who prefer to work with Realtors who are experienced in probate and trust sales.
Sometimes executors and trustees hire real estate agents who are inexperienced with probate and trust sales. This is an expensive mistake as the more involved the attorney is in overseeing the Realtor’s paperwork, the higher the attorney fees.
If you don’t have a living trust – contact me today for an attorney recommendation – this is a costly mistake for your heirs. If you don’t have a living trust, when you pass your home is subject to California probate and the legal system closely regulates the process. Everything takes longer and there are substantial attorney fees.
The Westchester listing I have is a probate sale. Not all probate sales need to be confirmed by the court. But this sale was subject to court confirmation. On Monday, I had to go to Court. At that time any overbidder could have outbid the existing buyer’s $927,000 offer by $968,600. There is a formula to determine the overbid, but it’s roughly 5% over the existing buyer’s agreed upon selling price. In this instance there were no overbidders and the original buyer remained in escrow at their $927,000 price. The judge confirmed this sale and we can now move to closing escrow.
It is a precarious position for a buyer because by the time they go to probate court; they have removed all their contingencies and don’t know if another buyer will appear in court. If they do, the original buyer is now competing with any overbidders and can lose the property if they don’t keep up – it can be very similar to an auction.