Tuesday, December 2, 2014

Probate referee verses real estate appraiser - Pros, cons, differences - Mary Cummins

Probate referee, Los Angeles, Real Estate Appraiser, Appraisal, California, licensed, Mary Cummins

Back in the 1980's before the S & L crisis there were "inheritance tax assessors." Then we got rid of the inheritance tax. Another result of the S & L crisis was mandatory licenses for real estate appraisers. I was a licensed broker in 1984. I also did appraisals. We did not need a real estate appraisal license until 1994. I fully agreed that real estate appraisers should be licensed and insured just like real estate brokers, notaries... Back then most appraisers were at least licensed real estate agents.

In 1994 the old "inheritance tax assessors" became "probate referees." This is a legal licensed designation by the state of California. You need to be a lawyer, accountant, appraiser or someone with a college degree who has experience doing appraisals. You don't have to be a licensed real estate appraiser to appraiser property for estate purposes. Below is a guide written from the pro-probate assessor point of view.

http://www.sco.ca.gov/files-eo/probate_guide.pdf

If you have an attorney handling an estate, they will tell you to consider a probate referee. They must do this to limit their liability in case they order an appraisal and one or more of the parties do not agree with the appraised value. They don't want to be sued. If you do not want a referee, you must sign a form, waiver stating that the attorney advised you of your right to seek a referee but you declined.

If you look in the above guide, these people charge 1/10 of 1% to appraise real estate. If you have an average $1,000,000 home in LA you would pay them $1,000. A normal appraisal cost is $300 to $350. Plus, a real estate appraiser is more experienced at appraising homes. Probate referees appraise real property, personal property, jewelry, automobiles, stocks, bonds, partial interests, business opportunities.... Not only that but you have to just accept the value they give you which they give to the government for estate purposes. Generally all appraisers should never vary by more than five percent from another appraiser in their appraisal report of the same property. Any more than that shows lack of experience, knowledge or intentional fraud.

Years ago it was illegal for lawyers, CPAs, anyone other than a real estate agent/broker to take a percentage of the sale or appraised value of real estate. Lawyers, CPAs generally did this with little old ladies in real estate deals. I know because I reported a few who took commissions on sales in which they were not involved in any way. I saw it in the escrow closing statements. They were ripping off their little old lady clients and their children anywhere from three to seven percent while they did nothing relative to the sale. They were breaking the law. I think this is why the "probate referees" were approved. They still need to be third parties other than the estate lawyer or a party to the estate.

The idea of a probate "referee" might be appropriate if there are multiple parties who can't agree on anything who all want to do their own appraisal. Then the $1,000 vs $350 times the number of parties might make sense. If someone just needs to know a date of death value of real estate, a licensed, insured, experienced real estate appraiser makes more sense.

This is the form which must be filled out by either the probate referee, estate attorney, or heirs.

http://www.courts.ca.gov/documents/de160.pdf

You attach this form which is the inventory of assets.

http://www.courts.ca.gov/documents/de161.pdf

If you scroll down, there is a sample showing how to fill it out.

http://www.riverside.courts.ca.gov/probate/probate_sampleinventoryappraisal.pdf

It would be pretty easy to make this inventory of bank accounts, stocks, bonds, real estate...yourself. Most appraisers for home, car, jewelry charge $300. If the estate is only worth $100,000 then paying $1,000 for home, jewelry, art appraisals might not be bad. But if you have an estate which is mainly real estate, cash, stocks, bonds, regular automobiles, it makes more sense to hire a real estate appraiser, look up Kelly Blue Book value of the car and look at the stock, bond, banking account balances.

Mary Cummins of Animal Advocates is a wildlife rehabilitator licensed by the California Department of Fish and Game. Mary Cummins is also a licensed real estate appraiser in Los Angeles, California.

Mary Cummins, Mary K. Cummins, Mary Katherine Cummins, Mary Cummins-Cobb, Mary, Cummins, Cobb, real estate, appraiser, appraisal, instructor, teacher, Los Angeles, Santa Monica, Beverly Hills, Pasadena, Brentwood, Bel Air, California, licensed, permitted, single family, condo, pud, hud, fannie mae, freddie mac, uspap, certified, residential, certified resident, apartment building, multi-family, commercial, industrial, expert witness, civil, criminal, orea, dre, insurance, bonded, experienced, bilingual, spanish, english, form, 1004, 2055, land, raw, acreage, vacant, insurance, cost, income approach, market analysis, comparative, theory, appraisal theory, cost approach, sales, matched pairs, plot, plat, map, diagram, photo, photographs, photography, rear, front, street, subject, comparable, sold, listed, active, pending, expired, cancelled, listing, mls, multiple listing service, claw, themls,

No comments:

Post a Comment