How do I inventory and value real estate, including parcels under foreclosure, for the probate inventory? – North Carolina

Short Answer

In North Carolina, a personal representative generally lists estate real property on the probate inventory with enough detail to identify each parcel (such as deed book/page and parcel ID) and reports its fair market value as of the date of death. If a parcel is in foreclosure, it is still typically listed as an estate asset, and the mortgage or deed of trust is listed as a related liability; the value reported should still be the date-of-death fair market value (not the foreclosure bid). If the value is not yet known when the inventory is due, the parcel can be listed with an “undetermined” value and updated later through a supplemental inventory or on the accounting.

Understanding the Problem

In North Carolina estate administration, the administrator must decide how to list and value a decedent’s home and other land on the probate inventory when there are multiple parcels and at least one parcel may be in an active foreclosure. The key questions are what identifying information must be included for each tract, what valuation standard applies, and how to handle uncertainty when the property’s market value is not clear at the time the inventory is due.

Apply the Law

North Carolina requires a personal representative to prepare an inventory that is complete and itemized enough for the Clerk of Superior Court to understand what property the estate owns and what it is worth. For probate purposes, the standard valuation used for estate assets (including real estate) is generally the property’s fair market value as of the decedent’s date of death. A personal representative may hire an appraiser to help determine fair market value, and if the appraisal is not finished when the inventory must be filed, the inventory can show the value as “undetermined” and then be corrected later.

Key Requirements

Identify each parcel clearly: List each tract with information that lets a title professional and the Clerk match it to the public records (commonly deed book/page reference, street address or acreage, and the county tax parcel number/PIN).
Use a date-of-death fair market value: Report the best good-faith estimate of what the parcel would have sold for on the date of death under normal market conditions, even if a foreclosure is pending.
Disclose encumbrances separately: List the related mortgage or deed of trust as a liability (with lender/payee and current balance if known) rather than “netting” it out of the real estate value line item.

What the Statutes Say

N.C. Gen. Stat. Chapter 28A (Administration of Decedents’ Estates) – Sets out core duties of a personal representative, including inventories, corrections, and the ability to use appraisers (the controlling sections are within this Chapter and can vary by the inventory issue).
N.C. Gen. Stat. § 105-283 (Uniform appraisal standards) – Defines “true value” (market value) for North Carolina property tax appraisal, which often provides a practical starting point when gathering valuation information from the county.

Analysis

Apply the Rule to the Facts: The estate includes a home and additional parcels of land, so the inventory should list each parcel separately with deed reference and a county parcel ID/PIN to avoid confusion later when the property is sold or transferred. Because at least one parcel may be under foreclosure, the inventory should still include the real property as an asset and separately list the mortgage/deed of trust as a liability with the best available payoff information. If the administrator cannot obtain a reliable date-of-death value by the inventory due date (for example, because an appraisal is pending), the administrator can file the inventory with “undetermined” for that parcel and then update the value later.

Process & Timing

Who files: The administrator/personal representative. Where: The Estates Division of the Clerk of Superior Court in the county of administration in North Carolina. What: The North Carolina probate inventory form (commonly an AOC estate inventory form used by Clerks) listing real property and related debts. When: Typically within about three months after qualification, unless the Clerk sets a different deadline or grants an extension.
Gather the identifying data: Pull the last recorded deed(s) from the Register of Deeds, confirm the tax parcel number/PIN and assessed value with the county tax office, and collect mortgage statements, payoff quotes, and foreclosure notices for any encumbered parcels.
Choose and document a valuation method: Use a good-faith date-of-death fair market value estimate (often supported by a professional appraisal, a broker price opinion/market analysis, or other reliable comps). If still pending, file with “undetermined” and then file a supplemental inventory (or report the corrected value in a later estate account, depending on local Clerk practice).

Exceptions & Pitfalls

Mixing up “tax value” and “fair market value”: County assessed value can be a helpful reference point, but it is not always the same as date-of-death fair market value. If the tax value is clearly out of date (for example, after major damage or long-term vacancy), an independent valuation may be needed.
Netting out the mortgage: A common mistake is listing “equity” (value minus mortgage). Clerks usually expect the real estate to be listed at date-of-death value and the mortgage/deed of trust to be listed separately as a liability.
Under-foreclosure does not mean “no value”: A pending foreclosure does not automatically make the parcel worth zero. If there is potential equity, a correct inventory value matters for administration decisions, beneficiary expectations, and later accounting.
Insufficient property description: Listing only “home place” or an incomplete address can create problems later with title work, sale authority, or distribution. Deed book/page and parcel ID/PIN help avoid this trap.
Not updating when new information comes in: If a later appraisal, foreclosure development, or title discovery changes the value or reveals another tract, the inventory should be corrected with a supplemental filing or handled the way the Clerk requires.

Conclusion

For a North Carolina probate inventory, the administrator should list each parcel of real estate with clear identifying information (such as deed book/page and the county parcel ID/PIN) and report a good-faith fair market value as of the date of death. Parcels in foreclosure are still typically listed as estate assets, with the mortgage or deed of trust listed separately as a liability. The most important next step is to file the estate inventory with the Clerk of Superior Court within about three months after qualification, using “undetermined” only when a date-of-death value cannot be confirmed in time.

Talk to a Probate Attorney

If an estate includes a home, multiple land parcels, or property under foreclosure, the inventory and valuation decisions can affect deadlines, creditor issues, and the path to closing the estate. Our firm has experienced attorneys who can help explain options and timelines under North Carolina probate rules. Call us today at (919) 341-7055.

Disclaimer: This article provides general information about North Carolina law based on the single question stated above. It is not legal advice for your specific situation and does not create an attorney-client relationship. Laws, procedures, and local practice can change and may vary by county. If you have a deadline, act promptly and speak with a licensed North Carolina attorney.