Informal versus Formal Probate Administration and Real Estate

With the enactment of the Massachusetts Uniform Probate Code (M. G. L. 190B)  we now have a new option in estate administration: informal probate.  The key advantage appears to be the ease and speed in which a personal representative can be appointed.  In theory, upon just seven days advanced notice to interested parties and MassHealth, a petition for informal probate can be brought and acted on by the probate court.

When one of the probate assets is an interest the decedent held in real estate, consideration should be paid from the outset as to whether formal probate is preferred to informal probate.  I tend to group the factors into whether the property will be sold quickly or will the beneficiaries keep the property:

Will the Property be Sold Quickly?  If the intent is to sell the real estate out of the estate and distribute the proceeds to the beneficiaries, informal probate may be adequate.  REBA Title Standard 10 indicates that the personal representative with the power to sell in the Will has the power to convey title to the purchaser free from claims of creditors.  Land Court indicates that it will recognize a deed signed by an informally appointed personal representative.  In fact, informal probate may be ideal for this situation where a pending sale requires the quick appointment of a personal representative through informal versus formal probate.

Will the beneficiaries of the estate keep the property for the foreseeable future?  If so a formal determination of heirs of the estate may be necessary in cases where there is no will in order to vest title to the real estate into the heirs.  With registered land it is necessary to have a formal opening to change ownership with the land court.  A deed of distribution showing title transferring to the beneficiaries of the estate alone may not be enough to convey clear title.  With an estate opened with an informal proceeding, a formal closing proceeding may be the best way to terminate the personal representatives power to sell under the Will as well as clear the title of creditor claims and costs of administration (M.G.L. ch 202 s 20a) which could in theory attach to the real estate for up to 6 years from the date of the bond.

While informal probate can be tempting with its ability to quickly have a personal representative in place, a careful analysis of informal versus formal proceedings should be done prior to initiating a probate proceeding so the above factors and others can be addressed early on.  Every situation is different and therefore it is best to review this with an attorney before filing for probate.