This could be a very stressful situation, and it is essential to have some basic knowledge of the Illinois laws in this regard. After the debts are paid, and the dust settles, of course the burning question is: “whose house will it be ?” It is helpful to obtain a copy of the deed for this. If you can’t get it by usual means, you can always get it from the recorder’s office at the county courthouse.
Here are some things you should know in regard to Illinois law. Disclaimer: for more details, and to be sure you are doing the right thing, consult a law firm. I highly recommend Brabender Law, LLC in Chicago.
- First thing to establish: how is the house legally owned?
- The simplest case: sole ownership. If there is only one name on the deed, that’s what you got. If there is a will, then the ownership goes according to the will, if not, then a new owner takes over according to the laws of the state where the decedent lived. In this post we’ll assume it’s Illinois. In either case, it has to go through probate court proceedings. However, there is an exception to this. If the owner of the house signed and notarized a Transfer on Death (TOD) deed then probate is not necessary, and the new owner named in the TOD can take over right away.
- Tenants in common. If there are two or more names on the deed, and it does not have the words “joint” or “entirety” on it, then the house is owned by the individuals named as “tenants in common”. In this case the owners each own a fraction of the property, say 1/2 or 1/3, depending on how many owners, and whether the percentage or fraction of ownership is stipulated. If one owner dies, his/her ownership interest is passed on to his/her heirs, but only after probate court proceedings, and it does not affect the other owners at all.
- Joint Tenancy. Here too there are two or more names on the deed, but if one of the owners dies, the other(s) automatically acquire his/her portion. In the case of married couples who are joint tenants, if one should die, the other gets 100% sole ownership without going through probate. But if the surviving spouse should die, since he/she has sole ownership, it has to go through probate. Tenancy by the Entirety is a special form of joint tenancy that only applies to married people; for our present purpose, the rules are the same as for joint tenancy.
- Beneficiary of a Land Trust. In this case, the house is legally owned by a Trustee, and not necessarily by the person living in the house. There should be a trust agreement signed by the trustee and the decedent. If you can’t find it, you could contact the trust company to get a copy. The decedent is most likely designated as the beneficiary of the trust. Most trust agreements have successor beneficiaries named, and when the first line beneficiary dies, the successor will automatically take over, without having to go to court. The reason for this is that legally the house never changes hands, it is still owned by the trustee. Once you are the beneficiary, and have the power of direction, you can take it out of the trust if you wish. Hint: If you find out the house is in a trust, but you don’t know where, check with the Chicago Title and Land Trust Company, as it took over many land trusts from banks that discontinued their land trust departments.
2. What next?
If the following hold, you are going to have to go to probate court:
- Sole ownership, with or without a will; in either case a judge will have to bless the arrangement. If there is no will, the inheritance will occur in accordance with the succession rules of the State of Illinois, which is explained later in this post. The exception to this is if the decedent executed and had notarized a Transfer on Death deed.
- Tenants in common. Here you inherit only the portion or percentage of the property the decedent owned, and the person or persons who inherit will be in accordance with the laws of Illinois.
- Joint tenancy, where both or all of the joint tenants are deceased.
If one of the following conditions are true, you don’t need to go to court to establish ownership:
- Sole ownership, when the decedent executed a Transfer on Death deed, naming you as the new owner.
- Joint tenancy, or tenancy by the entirety, where you are named as one of the joint tenants.
- If the property is in a Land Trust, or another kind of trust, which legally owns the property, and the trust agreement names you as a successor beneficiary.
If probate court is necessary, here is a summary of the Illinois laws of succession as stated in 755 ILCS 5/2-1.
If the decedent left a will, then the property will go to the person or persons named in the will after the probate judge approves. If no will was left, here is a simplified version of the laws that apply:
- If the person dies leaving a spouse and no children, everything goes to the spouse.
- If the person dies leaving no spouse, but only children, the children split the inheritance evenly.
- If the person dies leaving a spouse and also children, the estate goes 1/2 to the spouse, and the other 1/2 to be split equally among the children.
- If there is no spouse, and no children, the property goes to the decedent’s parents and siblings, in such a way that each parent and each sibling takes an equal share. If a sibling has died before the decedent, then that sibling’s children will take his/her share.
In the probate court, usually one of the first orders of business is to appoint an executor. Normally this job goes to the closest relative of the deceased. If it is the will of the beneficiaries of the estate that the property be sold, rather than passed on to them, the first order of business for the executor is to order an appraisal, With that in hand, he may then put the property up for sale, and when he finds a buyer willing to pay at least 90% of the appraisal amount, seek the approval of the judge before the sale can be finalized.
Chartered Quarters LLC stands ready to assist with all the non-legal aspects of this difficult and time-consuming process, as the principal has experience serving several banks as a Receiver in the Chancery Court of Cook County, and will be glad to make an offer on any real property that might be part of an estate. To get that process started, please fill out this form