How Overbidding Works at a Probate Confirmation Hearing

When a probate estate sells a home under limited authority, the sale needs court confirmation: a judge reviews it at a hearing before it can close. The court's aim is to make sure the estate, and through it the heirs and any creditors, receives a fair price. So the sale is announced in a published notice, and at the hearing other buyers may offer more than the price the estate accepted.

If you are buying a probate home in Los Feliz or anywhere in Los Angeles County, this is the part of the process that feels least like a normal purchase. It helps to see it clearly ahead of time. Sales under full authority, and sales from a living trust, do not have this step.

It also helps to know that an overbid is a possibility, not a certainty. Some hearings have no overbidders at all, and the judge confirms the sale to the original buyer. Either way, the process is the same for everyone, and every rule that follows is set out before anyone walks into the courtroom.

The first overbid in the courtroom cannot be a few dollars more. It has to clear the accepted price by a set amount, made of two parts:

• 10% of the first $10,000 of the accepted price, plus
• 5% of the rest of the accepted price.

For example, with round numbers: if the accepted offer is $500,000, the first part is 10% of $10,000, or $1,000. The second part is 5% of the remaining $490,000, or $24,500. Add both to the accepted price and the first overbid must be at least $525,500.

This example is only to show the math. The actual figures for any sale are in the attorney's petition to the court, and the listing agent can share the starting overbid amount once it is set.

When the case is called, the judge asks whether anyone wishes to overbid. If no one does, the judge usually confirms the sale to the original buyer at the accepted price. If someone does, bidding opens at the minimum overbid, and the judge usually sets how much each further bid has to increase.

The original buyer can usually bid too. Bidding continues until no one offers more, and the judge confirms the sale to the highest bidder. The whole exchange can take a few minutes, which is why it pays to decide your limit beforehand. You can see where this fits in the larger sale on our process page, under accepting an offer and the court step.

Overbidding is not a casual step. A person who wants to bid is generally expected to:

• Be present at the hearing, or be represented there.
• Bring a deposit, commonly in the form of a cashier's check.
• Be ready to buy on the same terms as the accepted offer, which usually means the home as is and without inspection or loan contingencies.
• Have their financing or proof of funds in order before the hearing.

The court's specific requirements can change from case to case, so anyone planning to overbid should confirm the details with their agent and the estate's attorney well before the hearing date.

The formula works in your favor in one way: anyone who wants to outbid you has to come in meaningfully higher, and has to do it on terms that are already settled. Your part is to be ready. Know the starting overbid amount, decide the highest number you would pay, and plan to attend the hearing or have your agent there on your behalf.

If another bidder wins, your deposit is generally returned under the terms of your purchase contract. Read those terms with your agent before you sign, and bring any legal question to your own attorney. Our post on how court confirmation affects a buyer's timeline and offer covers the weeks leading up to this moment.

At Rooster Homes, we prepare buyers and their agents for the confirmation hearing, including the starting overbid amount and what to bring, so the courtroom holds no surprises. Brandon S. Arlington holds the Certified Probate & Trust Specialist designation and works alongside the estate's attorney through every court step.

If you are considering a Los Feliz probate home that is headed to a confirmation hearing, or thinking about overbidding on one, we are glad to talk through how it works for that specific sale. Start a confidential conversation whenever you are ready.