What steps do I need to take as trustee to hire a realtor and set a fair listing price? – North Carolina

Short Answer

In North Carolina, a trustee generally should (1) confirm the trust document authorizes a sale and sets any limits, (2) document the property’s condition and title issues, (3) hire a qualified realtor under a written listing agreement, and (4) set a listing price based on fair market value supported by objective data (often an independent appraisal and/or broker price opinion). When the sale is needed to pay valid creditor claims, careful documentation matters because beneficiaries may later question whether the trustee sold for a fair price, especially when the property has known damage that affects value.

Understanding the Problem

In North Carolina, a trustee may need to sell trust-owned real estate after a death to raise cash to pay creditor claims, even when the trust was designed to avoid an estate sale. The decision point is how a trustee can hire a realtor and set a fair listing price when the property has a known defect that will reduce value. The focus is on the trustee’s steps to show the sale process was reasonable and the price was supported by reliable information, rather than guesswork or pressure from one beneficiary.

Apply the Law

Under North Carolina law, a trustee must follow the trust’s terms and act prudently and in good faith when managing and selling trust property. In a real estate sale, that usually means confirming authority to sell, investigating the property’s condition and title, using qualified professionals when needed, and keeping records that show the trustee sought fair market value in light of known defects. If a court-supervised sale becomes necessary (for example, in certain special proceedings involving trust property), the Clerk of Superior Court can have a role in authorizing and supervising the sale process and related reporting.

Key Requirements

Confirm authority and limits: Review the trust instrument for a power of sale, any required consents, and any instructions about timing, minimum price, or how sale proceeds must be used.
Establish fair market value with support: Use objective information (appraisal, broker price opinion, comparable sales, and repair estimates) to set a listing price that reflects the property’s actual condition, including known damage.
Use a reasonable marketing and hiring process: Select a realtor based on qualifications and a plan to market the property, document why that realtor was chosen, and use a written listing agreement with clear terms.

What the Statutes Say

N.C. Gen. Stat. § 1-339.4 (Who may hold sale) – In certain judicial sale proceedings, the court order can authorize a trustee to hold the sale of trust property.
N.C. Gen. Stat. § 30-3 (Valuation of property) – Uses a fair market value framework for valuation in certain post-death proceedings, reflecting the common legal concept of fair market value.

Analysis

Apply the Rule to the Facts: The trust holds real property after a death and now needs to sell to pay creditor claims, so the trustee should treat the sale like a documented, arms-length transaction. Because a damaged retaining wall tied to a past easement issue will likely reduce value, the “fair” listing price should be supported by objective evidence that accounts for that defect (for example, an appraisal that notes the condition and repair bids). Hiring a realtor should follow a reasonable selection process with a written agreement and a marketing plan that fits the property’s condition and target buyers. Clear records help show the trustee acted prudently even if the final sale price is lower than a beneficiary expected.

Process & Timing

Who acts: The trustee. Where: Primarily outside court (trust administration), but potentially through the Clerk of Superior Court if a court-supervised sale or related special proceeding is required. What: (a) Review the trust for sale authority and any consent requirements; (b) gather deeds, liens, easements, and other recorded documents; (c) confirm property tax status and insurance coverage; (d) document the property condition, including the retaining wall damage. When: Before signing a listing agreement or setting a price.
Hire a realtor with a paper trail: Interview at least two or three realtors when practical. Compare proposed list price, comps, marketing plan, experience with defect-affected properties, and commission terms. Choose one and sign a written listing agreement that addresses term length, price, commission, repair/credit strategy, and how offers will be presented to the trustee.
Set and support the listing price: Order an independent appraisal or, at minimum, a broker price opinion supported by comparable sales. Obtain at least one contractor estimate for the retaining wall issue (or an engineer’s opinion if needed) and decide whether to (a) repair before listing, (b) price “as-is,” or (c) disclose and offer a credit. Keep the appraisal/BPO, estimates, comps, and the trustee’s written pricing decision in the trust file.

Exceptions & Pitfalls

Trust terms that restrict a sale: Some trusts require beneficiary consent, a co-trustee’s approval, or impose conditions on timing or minimum price. Skipping those steps can create personal liability for the trustee.
Pricing without accounting for known defects: Setting a price based on “perfect condition” comps while ignoring the retaining wall damage can lead to repeated price drops, longer time on market, and beneficiary complaints. A supported “as-is” price is often easier to defend than an unsupported number.
Weak documentation: A trustee should assume the file may be reviewed later. Missing comps, no appraisal, no repair estimates, or no written reason for choosing a realtor can make a reasonable decision look unreasonable.
Title, easement, and lien surprises: Past easement disputes and repair responsibility can affect marketability. Ordering a title search early and collecting recorded easement documents helps the realtor market accurately and helps avoid failed closings.
Disclosure and marketing missteps: Known conditions generally must be handled carefully in the listing and negotiations. A trustee should coordinate with the realtor and counsel on how to disclose the retaining wall issue and any related documentation.

Conclusion

In North Carolina, a trustee should hire a realtor and set a fair listing price by following the trust’s sale authority, using objective valuation support, and keeping clear records. A fair price usually means fair market value adjusted for known defects, supported by an appraisal or broker price opinion and repair estimates for issues like a damaged retaining wall. The most important next step is to review the trust terms and then obtain a written valuation (appraisal or BPO) before signing a listing agreement and setting the initial list price.

Talk to a Probate Attorney

If a trust-owned home must be sold after a death to pay creditor claims and the property has condition issues that affect value, our firm has experienced attorneys who can help explain options, documentation steps, and timelines. 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.