How Does Michigan Probate Handle Rental Homes or Investment Properties After Someone Dies?
Rental homes and investment properties in Michigan may be subject to probate after someone dies. Our law firm’s probate lawyers in Bingham Farms could help you handle the probate process. We could also advise you on ways to keep real estate holdings out of probate court.
What Is Probate?
Probate is the process courts use to oversee the administration of a person’s estate after their death. Probate involves:
- Filing documents with the probate court in the county in Michigan where the deceased lived
- Inventorying real estate, property, and other assets belonging to the estate
- Paying any debts or taxes the estate owes
- Distributing the estate to the deceased’s beneficiaries (either according to a will or the state’s intestate laws if there is no will)
According to the Wayne County Probate Court, property owned solely by the deceased must go through probate. Insurance, retirement, investment, and other accounts without named beneficiaries must also go through the process.
What Happens to Rental and Investment Properties During Probate in Michigan?
When someone dies in Michigan and holds rental or investment properties in sole ownership, those properties must go through probate.
Once you open probate proceedings, the properties become the responsibility of the estate’s personal representative until probate concludes and the probate court closes the estate. The will may name the personal representative. If not, you must select someone and petition the court to appoint them.
During probate, the personal representative must:
- Secure the properties.
- Collect rents on behalf of the estate.
- Pay property expenses, including mortgages, utilities, and property taxes.
- Continue renting the property (with court approval).
The deceased’s will should state what should happen to the property. The will may direct that the property remain a rental, with the income benefiting an heir. The will may pass ownership of the property directly to an heir. The property can also be sold, with profits going to pay debts or to an heir.
Ways You Could Avoid Having Properties Going Through Probate
Our attorneys could help you or your loved one create an estate plan that will allow rental homes and investment properties to avoid going through probate.
One way to protect real estate and other assets from probate is to place them in a living trust. Once you place property in a trust, the trust owns it, not you alone. Therefore, trusts do not require probate. You control the trust during your lifetime. The properties pass to the beneficiaries according to the terms of the trust after your death.
You could also avoid probate by adding a co-owner to your properties. Upon your death, the property passes to the co-owner according to survivorship rights.
How An Estate Planning Lawyer Could Help
Our estate planning attorneys have over 60 years of combined legal experience. We could help you navigate probate if that is how you must handle the distribution of rental and income properties and other assets.
We could open probate proceedings for you in court, advise the personal representative, help inventory the estate, help settle the estate’s accounts, and assist with asset distribution.
If you or your loved one does not yet have an estate plan, let us help you create one. It could save your family time, stress, and money after your death.
Contact Bingham Legal Group PC for All of Your Estate Planning Needs
Probate can be complex, especially when it involves larger estates with multiple real estate holdings. Bingham Legal Group could guide you through the process.
We serve clients in the Detroit Metro area, the Tri-County area, and in Washtenaw, Livingston, St Claire, Jackson, Lansing, and Grand Traverse Counties from offices conveniently located in Bingham Farm. Contact us to learn more about how we can assist you with probate and comprehensive estate planning.