How Do I Get A House And Its Contents Valued For Probate
Posted on 6th May 2020
When someone passes away, especially if they own property, have bank accounts, shares, investments, or other assets, Probate will be required.
If the deceased left a Will, the executors named in the Will can apply for a Grant of Probate. If the deceased didn’t leave a Will, the people entitled to their Estate can apply for Letters of Administration (the people entitled will be known as Administrators). You can read more about what the difference between Grant of Probate and Letters of Administration is in our Probate Solicitors in Lancaster’s blog, here.
In order to apply for Probate (the collective term we will use for Grant of Probate and Letters of Administration), the value of the Estate will need to be calculated. In order to do this, our team of Probate Solicitors in Lancaster will need a full list of the deceased’s assets and their values, and any liabilities. For example, you may need to get any property valued by a few different Estate Agents, and then provide an average value for the Probate application.
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How Do I Get A House Valued For Probate?
Ensuring that a correct value of a property is obtained for Probate purposes is important. During the administration of the Estate, you will need to keep a clear record of how much money has come into, or has been paid out of, the deceased’s Estate. You will be responsible for paying any debts or other liabilities, such as outstanding utilities from after the person’s death, as well as collecting in money from bank accounts and other assets.
You will need to be able to account to the beneficiaries, whether or not you are one of them, for what is paid in and out.
So, to make sure that you are acting in the best interests of the beneficiaries, it’s important to get the property valued correctly.
First of all, it’s important to consider the state of the property, any additional land, recent sales of properties of a similar value, and current goings-on in the World (we all know what we’re talking about; it’s been an odd couple of years for the Property market: first our team of property solicitors were left wondering whether Brexit would have any impact, and then COVID-19 halted most property viewings).
Secondly, you should consider which Estate Agents you may want to instruct. It may seem best to jump immediately in to use the local ones, however, if the property includes land, farming land, or the Estate is liable for Inheritance Tax, you may wish to consider approaching a Chartered Surveyor, or an Estate Agents who specialise in Rural Farming Property. They may, in some cases, have more experience dealing with more uncommon types of property.
If there is Inheritance Tax payable, the valuation could be subject to the scrutiny of the District Valuer Services at HMRC, to ensure its accuracy. If they felt like the valuation was incorrect, they may question this and ask for evidence, and therefore it’s important to ensure that it’s accurate, as far as possible.
If HMRC believes that the valuation has been obtained negligently, they could impose penalties on the executors or administrators of the estate.
How Do I Calculate The Value If There Was A Mortgage?
The mortgage on any property would be included in a separate section of any inheritance tax forms, and therefore would be accounted for. If the property value was £200,000.00, and there was an outstanding mortgage of £150,000.00, then the property would have equity of £50,000.00. Therefore, only £50,000.00 of the property value would count towards the taxable estate.
What If The Property Was Owned Jointly With Someone Else?
The value of the property would still need to be worked out in full, and our Probate Solicitors in Lancaster would then calculate how much of the value belonged to the deceased. For example, if the deceased owned the house equally with another person (as tenants in common), then 50% of any equity would belong to them.
How Do I Work Out The Value Of The House Contents?
Our expert team understand that it can be hard to know where to start. Sadly, finding out whether any items’ value needs to be included for probate purposes, can be difficult for loved ones of the deceased. Of course, most of the deceased’s items will hold personal value for you. However, this doesn’t mean that, for Probate purposes, they are worth anything.
The first thing that you need to do is make a list of the contents of the house as well as it’s value. Common items that are likely to have any value can include the following:-
• Cars
• Jewellery
• Furniture
• Paintings
You could try and use the internet to ascertain a value. Websites such as ebay.co.uk, amazon.co.uk, or other specialist websites may be able to offer some guidance of what items similar to your loved one’s have sold for. You will need to take into account the age and condition of the item, too!
It's important to remember that if your loved one insured any particular items, they will likely have been worth more when they initially took out the policy, than as they have aged.
If you don’t feel ready to go through the house yourself to value the possessions, there are companies who may be able to do this on your behalf.
If you are certain that there is nothing of any value in there whatsoever, you may decide to have the house cleared without valuing any items.
Do I Need Grant Of Probate To Value The House And Contents?
You shouldn’t need to have applied for Probate in order to deal with the house and its contents, as otherwise you may go round in circles: you can’t apply for Probate without a property and contents valuation and you can’t get the valuation without Probate. That’s a sticky situation which, fortunately, isn’t the case!
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