How Quiet Title And Inherited Real Estate Issues Are Handled

Surprisingly, a large number of heirs do not probate the estate of a loved one when they pass. Even more surprising, this frequently happens even when the deceased owned real estate. The end result is that the real estate does not get re-titled in the heirs’ names and cannot be sold until it is re-titled. What most people do not know is that in the state of Tennessee, you must probate an estate within 10 years from the date of death. After that, it becomes a much more expensive and difficult process requiring a quiet title suit. It is also typically a more difficult process if the deceased did not have a will or if the intended heirs have passed. Typically, the longer one waits to deal with an estate, the more likely there will be a larger number of heirs. This is because when one heir passes, their inheritance passes per the designation in their will or by the laws of the state that determine who inherits. Since many people have children, this multiplies the number of heirs who must agree on how to divide the property.

If you have received notice of a quiet title lawsuit, you may be an heir to property that is still titled in the deceased’s name. In this case, the first thing to do is to determine if you may actually be related to the deceased property owner. While to date we have not heard of anyone using a quiet title lawsuit as a scam, it’s possible someone might try that and claim all the heirs have to pay back taxes on the property or something to that effect. Be suspicious if you receive notice of a quiet title lawsuit and they are asking you for money. Until you have been established as an heir by a court of law (and you can also refuse the inheritance), you don’t have any financial obligation, nor will you receive any money.

Do You Really Want To Be An Heir?

You may want to consider whether you really want to be an heir in a quiet title lawsuit. We have seen real estate that was not particularly valuable with 20 or more heirs where some of the great-grandchildren had shares that were less than 1% of the total property value. In this particular example, a 1% share was worth less than $250 if the property sold. In the meantime, the heirs had many contentious meetings arguing over whether to sell the property or not. In the time they spent fighting over it, they could have earned $250 with far less stress. So, that’s the second thing to consider: is this land valuable enough to me personally to be worth the trouble to ensure I get my share of it? You may find walking away with nothing brings you more peace. If you choose to pursue your potential inheritance, you will fare better by hiring an attorney who can help you prove you are an heir and ensure you get your fair share.

Probating Property: Sooner Rather Than Later

If a loved one who owns any property has recently passed, the sooner the property is probated the better. Note that, in Tennessee, you do not have to probate an estate in certain conditions. For example, if your spouse passes and all assets, including the real estate, are in both your names, you will inherit the house without probating it. However, be aware that you will need to have your spouse’s death certificate should you decide to sell it as long as your spouse’s name remains on the deed.

For more information about probating an estate, see our probate and estate administration information.

Filing A Quiet Title Suit

In the event that all owners listed on the title of a piece of real estate have passed away more than 10 years ago and their heirs now wish to sell the property, you will need to file a quiet title lawsuit. This is a process that requires identifying and notifying all potential heirs, attempting to prove or disprove their legitimate claim based either on the will of the deceased property owner or by the default inheritance rights established by Tennessee law, negotiating with all heirs to determine the proper course of action, and eventually either presenting an agreed order to the court to approve or having the court rule if the heirs cannot agree. Generally, these require an attorney to at least represent the estate and the court will likely appoint one. Note that the attorney will get paid out of the proceeds from the estate before anyone else does. The more the heirs fight over the inheritance, the more time the attorney will spend and the more money will go to that attorney. All heirs should be highly motivated to agree as quickly and easily as possible. Arguing over small differences will cost more than what you’re arguing about when an attorney is billing upwards of $350/hour.

That said, you should seriously consider hiring your own attorney as well. The attorney representing the estate cannot and does not represent your interest. Sometimes having representation can help keep the process moving forward and save you some money in the long run. However, be cautious about choosing an attorney and discuss the budget upfront. You may want to be very selective about how you use counsel so as not to end up spending more than you will inherit.

Determining The Value Of A Property

When it comes to inherited real estate with more than one heir, your best outcome is that everyone agrees to sell it through a reputable relator who gets you a decent price. Agreeing to sell real estate can be very difficult, especially if some heirs have unreasonable expectations about what the property is worth. The court can solve this for you if you hire a licensed appraiser to provide the same type of appraisal they would do for a bank for the purposes of a mortgage. This will give you a good, objective opinion that is the same opinion that would be used to close on the sale of the property if the buyer takes out a mortgage. These usually only cost a few hundred dollars but can save thousands of dollars in legal fees if it helps end arguments. Given that the court will require an appraisal to resolve such a dispute eventually anyway, the least expensive route is to do the appraisal before anyone starts arguing about the price.

One thing to consider is whether any of the heirs are currently using the property. It’s quite common that one child of deceased parents has continued to live in their house, for example. Then, something changes, and the other heirs decide they want their share of the property. In this case, you will benefit from legal counsel whether you are the person who lives in the house or one of the other heirs. If no rent has been paid to the other heirs, there is an argument for reducing that heir’s share to reflect the benefit they have already received from living in the house. However, that can also be offset by maintenance done on the house, improvements, paying for taxes, keeping it insured, etc. So, depending on who has been paying for what and the market rate for rent for that property, the heirs could owe the person living there additional money. Again, if this is a few hundred dollars difference, bear in mind that it may not be worth arguing over compared to the cost of the attorneys’ time both in and out of court.

Get More Information

The bottom line is that quiet title can be a complex and difficult process that really requires having an attorney to manage it for at least the estate. If you have inherited property that requires a quiet title suit, you will want to start by contacting us at Tidwell & Associates for guidance.