CHAPTER 2: ESTABLISHING CLEAR TITLE Why Wills Are Important
Having a will reduces the likelihood that the property will have a clouded title (unclear title). One of the most significant problems that a buyer of land encounters when they are interested in acquiring a piece of land is the discovery that the property is owned by multiple relatives because a former owner of the property died without a will. In order to purchase such a property with clear title, a potential buyer must locate each and every owner of the property and obtain their permission to purchase their interests in the property. Whenever a property owner dies without a will, the surviving family members inherit the property “in common,” which means that the surviving family members own an interest in the entire property and no single person owns a specific part of the property. Specific laws govern which family members inherit the property; these laws are discussed in part below. Family members who inherit property are called heirs. The chart on the following page shows how it can take just two generations of a parent dying without a will to end up with dozens of heirs owning the same piece of property. The chart is based on an actual family that had a difficult time clearing title to a house because the original homeowner died without a will. Without clear title, questions of who pays for repairs, who lives in the house, who pays the property taxes, and who is entitled to mortgage or sell the property can be the cause of many family feuds. These disputes can lead to abandonment, delinquent property tax lawsuits, and tax or mortgage foreclosure sales. The lack of clear ownership that can result when a person dies without a will makes it difficult to sell the property. For a potential buyer trying to acquire the property, it may take years to find all the heirs and get their permission to purchase the property. Together, the time and expense incurred in locating all of the heirs can make the purchase cost prohibitive for the buyer. The potential buyer of the property will encounter even greater barriers when one or more of the heirs cannot be located or are unwilling to sell their interests in the property. As a general rule, a buyer should not purchase a property unless all of the heirs are identified or determined through probate court proceedings, all of the heirs are located, and all of the heirs consent to sale of the property. Otherwise, a title insurance company is less likely to insure the property, and the buyer is taking a risk that an heir could resurface and make a claim against the property, jeopardizing the buyer’s investment in the property.
Clearing Title To Property When an Owner Dies Without a Will Identification of Heirs Specific inheritance laws govern which family members inherit an interest in property of an owner who dies without a will, as illustrated by the following charts. For example, when a man who owns a house with his second wife as community property dies without a will and is survived by her and his child from a prior marriage, the law provides that his one-half interest in the house passes to the child and that the wife retains her one-half interest. Consequently, the second wife will own the house in which she lives along with her stepchild. The more children involved, the more complicated the ownership becomes. The identification of the heirs of a deceased property owner is usually determined through interviews with other family members and family friends, but can also involve research of public records on marriages, births, and deaths. In certain instances, heirs can be determined through court proceedings in the county where property is located or the county in which the deceased resided at the time of death.
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