BIC TIP #1129: Estate Sales and Trusts
Estate sales sound simple until they are not. One of the most common disclosure failures I see involves probate property and upset bids, and it usually starts with a dangerous phrase: “We are under contract.”
In an estate sale, being under contract does not always mean the deal is done.
Probate Changes the Rules
When a property is owned by an estate, an attorney is often involved and court oversight may apply. Some estate sales are subject to an upset bid period, meaning that after a contract is signed, other buyers may legally submit higher bids within a defined window. If that happens, the original buyer can lose the property even though they were “under contract.”
That is a material fact.
What Must Be Disclosed
Brokers must clearly disclose:
- That the property is part of an estate or probate
- Whether the sale is subject to an upset bid period
- The role and authority of the estate attorney or personal representative
- That the contract may not be final until court approval or expiration of the upset bid period
Failing to explain this creates false expectations and exposes both broker and seller to serious risk.
Why Buyers Get Burned
Buyers hear “under contract” and assume certainty. In estate sales, certainty often does not exist until the upset bid period expires or the court signs off. That difference matters, and the Commission expects brokers to make it crystal clear.
Bottom line: If the sale can be undone by statute or court process, it must be disclosed early and often.
