The Executor Sold the House Without Telling the Heirs: What You Can Do

Finding out that a parent's house was sold, and that nobody mentioned it, is alarming. Some sales are proper. A sale by someone with no authority, or an executor who kept the proceeds, is something courts can fix, though the first job is to find out exactly what happened.

Find out who sold it and on what authority

1. Look up the deed history on the county recorder's website. It shows who signed and when.
2. Check the probate court docket for the parent's estate: was an executor appointed, and did the court approve the sale if approval was required?
3. Ask the executor in writing for the sale contract, closing statement, the purchaser's name and where the money went.
4. If the house was in a trust or passed by transfer-on-death deed, find out whether the seller was the trustee or the named owner.

Some sales are proper

A properly appointed executor often has power to sell real estate under the will or by statute, sometimes without a hearing, though some states require notice to heirs or court confirmation. A sale can also be valid if the house had already passed by deed to the person who sold it. An heir who is unhappy with a valid sale generally has a claim to the money, not to the house.

Signs the sale may be challengeable

• The seller was not appointed by the court, or had no power under a trust.
• The required notice or court approval was skipped.
• The price was far below market and the buyer was a relative or friend of the executor.
• The proceeds were not deposited in an estate account.
• The seller signed a deed for property that had passed to someone else.

Your options

1. Ask the probate court to order the executor to file an inventory and a full accounting. Heirs have standing to ask.
2. Ask the court to freeze remaining estate assets or require a bond if there is risk of loss.
3. Ask the court to surcharge the executor for losses caused by a sale below value or by self-dealing.
4. In serious cases, ask for removal of the executor and appointment of a neutral successor.
5. If the seller had no authority, a lawyer can examine whether the sale can be set aside, balanced against the rights of a buyer who paid in good faith.

Deadlines

Heirs have limited time to challenge sales, accountings and fiduciary conduct, and the clock can start when the transaction was recorded or when you learned of it. Do not wait for family tensions to settle. See our guides to removing an executor and to executor duties.

Costs and practical advice

A probate litigator can estimate the cost against the amount at stake. If the sale price was reasonable and the money is still there, a demand for an accounting and distribution often settles things. Keep communications calm and in writing, since they become exhibits.

What to ask for in your first letter

A short written request should ask for the sale contract, the closing statement, the appraisal or listing history, proof of where the net proceeds were deposited, the estate's inventory and bank statements since the date of death, and a list of debts and expenses paid. It should say you are an heir and ask for the documents by a date. Courts often treat refusal to provide basic information as a reason to compel an accounting.

Reading a closing statement

The settlement statement shows the price, payoff of any mortgage, commissions, taxes and the net amount to the seller. Compare the price with recent nearby sales, check whether a commission went to a relative, and see whether the net proceeds match what the estate received. Gaps between the net and the estate account are what a lawyer will chase.

Frequently asked questions