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Ask a real estate pro: Seller died days before closing. What can we do next?

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Q: After selling our prior home and moving to the area, we are purchasing a home from a lovely couple. A few days before the closing, we were told the husband unexpectedly passed away. While we feel bad for the grieving widow, all of our things are in storage, and we still need a place to live. What are our rights? — Kim

A: Real estate transactions are controlled by the agreement the parties signed. Your first step is to review your contract, paying particular attention to the fine print.

Most contracts will have a clause dealing with this issue, often titled “Persons Bound” or something similar, and say something like, “This contract is binding on, and inures to, the parties and their respective heirs or successors in interest.”

This means that if the owner passes away or even deeds the house to someone else, the heirs or new owner would still be bound by the contract.

It also means that if the buyer were to pass away, their estate would need to complete the deal or risk losing the earnest money deposit.

Additionally, since both spouses signed the contract, the surviving spouse is still under contract.

Once you determine the widow is obligated to close, you must examine the property’s title to determine how it was owned. If the property was owned only by the spouse who passed away, probate will likely be necessary and could take several months.

However, if the property was owned in a living trust, which is a common estate planning method, the trust agreement will appoint a new trustee who can sign the deed at closing without waiting for probate.

Similarly, if both spouses owned the property together, the widow would be the sole remaining owner and could sign the deed at the closing.

The closing attorney will review the specifics to determine the exact steps needed to finish the transaction.

While closing any deal is stressful, and you need a place to live, it is essential to remember that the widow and her family suffered a tragedy. In my experience, with proper sensitivity on your part, the widow will still want to conclude the sale and move on.

By understanding the contract, being flexible, and dealing with a bit of inevitable delay, you should be able to finish buying your new home.

Board-certified real estate lawyer Gary Singer writes about industry legal matters and the housing market. To ask him a question, email him at gary@garysingerlaw.com, or go to SunSentinel.com/askpro.