Is A Bond Required?

Is a Bond Required to List and Sell Real Property?

Q: Can a bond be waived?

A: It would be up to the Judge’s discretion waive or not waive a bond in the case of an administrator with limited authority. If the administrator does not live in California, the Judge will most likely require a bond, even if everyone agreed to waive it. If the administrator lives in California, there’s no will waiving bond, then the most likely way to get a bond waived is if all heirs agree to waive the bond.

Q: Can a listed agreement be signed prior to obtaining a bond?

A: Most likely yes. Usually the bond wouldn’t be required until the house is sold. The bond would probably have to be in place at the time the escrow closes. There have been circumstances where the court has waived the bond because the sale proceeds were deposited into a blocked account, subject to the Judge’s approval.

Q: Must the personal representative list the estate real property with a real estate broker?

A: The personal representative may legally market and sell real property without the services of a broker, as if he/she were the owner of the property. The personal representative is considered the “seller” in the transaction. However, the personal representative may list the property with a real estate broker. The process of listing, marketing and selling probate real property is much the same as any sales transaction with some exceptions discussed below. Unless the personal representative has full authority, a sale is generally subject to confirmation by the court.

Q: May the personal representative enter into a contract with a licensed real estate broker to sell estate real property?

A: Yes. The personal representative may enter into an exclusive right to sell contract with a broker for an original period of not more than 90 days plus one or more extensions each limited to the same periods (Cal. Prob. Code 10150(c)). This real estate broker may cooperate with other brokers and may advertise the property on the MLS (Cal. Prob. Code 10150(a)). Prior court approval must be obtained for each extension unless the personal representative has full authority. However, even here, if the personal representative has obtained only “limited” power rather than “full” power to administer the estate, court supervision of the sale of real property is required (Cal. Prob. Code 10501(b)).

 

This memorandum is one of the many Legal Q&As, Legal Briefs, and other free legal publications made available to REALTORS by C.A.R. For a complete listing of products and services available from C.A.R. visit C.A.R. Online at www.car.org.

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