Children cannot enter contracts because the law deems them legally “incompetent” due to their age. However, this doesn’t mean they can’t have interests in real property. Specific steps are necessary to approve the sale of real property involving a minor. The title company and the closing must ensure their approval for the transaction to proceed.
How Can a Minor Get an Interest in Real Property?
Florida’s homestead laws dictate that if an individual passes away and leaves behind a spouse and/or minor child(ren), the homestead automatically transfers to the spouse and/or minor child(ren) as per the law. In other words, if someone dies owning homestead property, their surviving spouse and minor child(ren) automatically get the property. You can accomplish this by using a Will in a probate proceeding or, in the absence of a Will, through the Florida intestate probate proceeding. A minor could also acquire an interest as a trust beneficiary if the grantor passes away, and the trust distribution provisions involve real property designated for a child.
What does a Sale of Real Property with a Child’s Interest Involve?
Suppose the minor child’s interest in that real property does not exceed $15,000. In that case, a parent, as a natural guardian, may be able to negotiate the listing agreement and the sale and purchase agreement on behalf of the minor child. However, if the minor child’s interest in the real property does exceed $15,000.00, Florida law requires that guardianship be open for the minor child. Establishing guardianship of a minor child’s property is a complex procedure that takes time and demands the expertise of a qualified attorney. After setting up and issuing Letters of Guardianship, a court-appointed individual representing the minor child can facilitate the sale of the real property in the real estate transaction. A guardianship is an entirely separate and distinct legal process from a probate matter for an estate of the deceased parent.
When is it Necessary to Appoint a Guardian Ad Litem?
To further complicate the situation, if the total proceeds from the sale of the real property exceed $50,000, it is necessary to appoint a guardian ad litem to represent the minor child in the probate matter, ensuring adequate protection of the child’s interests. This differs from guardianship because the appointment of a guardian ad litem occurs within the probate matter, separate from the guardianship and its associated rules. In addition to filing a petition to authorize the sale of real property in the probate proceeding, it’s probable that filing a petition to appoint a guardian ad litem and obtaining an order for the minor child would also be necessary. Once appointed, the guardian ad litem will prepare and submit a report to the Court before the Court can enter an order authorizing the sale of the real property.
In summary, If your client aims to sell real property with a minor child or children having an interest, it will require time and several procedures to obtain the necessary authorization for the sale and approval from the title insurance to issue a policy. Indeed, these are just a few crucial questions to ask and steps to take to ensure a smooth closing process when minors are involved in the transaction.
Should this type of issue arise or if you have any questions about what to do if a party owns real property that minors have an interest in, always contact a qualified real estate, probate, and guardianship attorney for a consultation.