Probate, simply put, is a judicial process that proves the validity of a will. This is done in a court of law, and typically takes 4-6 months (yes, MONTHS). Probate takes a few things into account: that the drafter has passed away, that the will is legal and valid (and final version), and that the person(s) claiming to be the executor(s) is/are formally appointed as the Estate Trustee. During this process, a will can be contested. You can see now why the process takes so long.
So why is probate so important? Well, probate is often required to complete a real estate transaction, and given the length of time to process probate, this can really impact a sale. Appropriate clauses also need to be utilized in the Agreement of Purchase and Sale if awaiting probate.
When Probate is Required
Simply put… you will likely need probate. Normally the Land Titles system will require probate. There really are only 2 rare instances where probate is not required, thus why it’s so important to start the probate process as soon as possible.
When Probate is NOT Required
- When the estate has a value of less than $50,000.
- Where the deceased acquired land previously with the Registry System, which was then converted to the electronic Land Titles system by the government, and there have been not other dealings with the property since that conversion (ie: first dealings)
The Toronto real estate market has its ebbs and flows. There are times in the year when it is the most ideal and practical to sell a property. Due to this, sellers often don’t want to wait for probate to list a property. This is normal and permitted. However, given the closing date cannot happen before probate is obtained, what happens if the property sells and probate has not been completed? Well, there are a few options:
- Amend the closing date
- Create an escrow agreement (buyers move in but don’t ultimately own the property until probate is obtained and title is transferred)
- Create a rental agreement to fill the gap
- Get a rush application for probate (this is costly)
As always, legal advice should be sought in all real estate transactions. We are real estate experts, and work with lawyers whom are the legal experts. Probate is common and is not something to fret about.
Call us today to book your complimentary private consultation, and see how we can help.