What happens if the seller dies before the closing?

UPDATED: Oct 1, 2022

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What happens if the seller dies before the closing?

I have a contract for the purchase of a business property that was supposed to close in 2 days. I am told the seller has been hospitalized with pneumonia so the closing date has been postponed one week. She is an elderly woman and I need to know what my

options are if she does pass away?

Asked on December 20, 2017 under Real Estate Law, Colorado


SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 5 years ago | Contributor

A contract to sell something, including real estate, is personal to the seller: if she passes away, the contract "passes away" with her. You cannot force the heirs or estate to sell, though they certainly may choose to do so. They can't keep your money without selling to you--the law does not let them do that, so you will get your deposit back if they don't sell, but that will take time and possibly some litigation if they don't understand or accept that they have to return the money (you may need a court to make them aware of their obligations).
And anything will be delayed--return of a deposit, or the estate or heirs selling to you--because when the seller passes away, there will be no one with legal right or authority to sell, at least not until someone is appointed the personal representative of the estate, or the home legally goes to some heir or beneficiary. So if time is important (e.g. you have a time limit on a mortgage), that will be a considerable issue, even if the estate or heirs want to continue with the transaction.
If she wants to sell and is mentally competent, even if physically frail, see if she will execute a power of attorney to give her realtor or real estate attorney or a family member/friend authority to execute the sale for her--that way, she doesn't need to leave the hospital room or travel. A lawyer could go to her and have the document signed right there by her in the room. Discuss this option with her relator or real estate lawyer.

IMPORTANT NOTICE: The Answer(s) provided above are for general information only. The attorney providing the answer was not serving as the attorney for the person submitting the question or in any attorney-client relationship with such person. Laws may vary from state to state, and sometimes change. Tiny variations in the facts, or a fact not set forth in a question, often can change a legal outcome or an attorney's conclusion. Although AttorneyPages.com has verified the attorney was admitted to practice law in at least one jurisdiction, he or she may not be authorized to practice law in the jurisdiction referred to in the question, nor is he or she necessarily experienced in the area of the law involved. Unlike the information in the Answer(s) above, upon which you should NOT rely, for personal advice you can rely upon we suggest you retain an attorney to represent you.

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