Tap the probate system to win the competition for great antiques

It’s no secret that antique dealers spend as much (or more) time acquiring inventory than they do selling it. Many dealers are up at the crack of dawn on weekends and spend their days searching estate sales, auctions, flea markets and antiques shows for merchandise. Some dealers take out-of-state road trips, and a few travel abroad to find inventory.

Others systematically work the online auction sites like eBay to find bargain treasures for re-sale. Almost all have spent years developing a network of pickers who can keep new inventory rolling in. Compared to antiques dealers, retailers of consumer goods have it easy. All they have to do to keep their shelves stocked is pick up the phone or go online and place a wholesale order from a catalog.

Antiques Auctioneer Wayne Jordan  Wayne Jordan, Behind the Gavel

The reason that dealers are such “early birds” when mining estate sales, flea markets and antique shows is obvious: They want to find the best merchandise and negotiate a good price before their competitors show up. Flea market and estate sale sellers sometimes don’t know what their merchandise is worth, and may accept an early cash offer.

Once “the competition” shows up and starts expressing interest in the same items, even an uninformed seller will hold the line on — or even raise — prices. In the antiques trade, where cost prices are negotiable and markups can be considerable, finding just a few special items a month can mean the difference between a meager profit and an outstanding profit.

So, if “being first” is good and “less competition” is good, it stands to reason that the best strategy for finding great deals is to jump to the head of the line and eliminate the competition altogether. Some dealers have already figured out this strategy, but not many: It’s called working courthouse probate records.

For those unfamiliar with courthouse probate records, let’s begin by understanding what probate is and end with a plan for mining probate records to find antiques and collectibles.

Probate is the process of proving the will of a deceased person. A decedent’s debts must be paid and property distributed according to their wishes. In most states, this process is overseen by a Probate Court, but sometimes it’s called an Orphan’s Court. A probate court decides the legal validity of the will, grants approval to proceed with its execution and appoints an individual to execute the provisions of the will. This individual is called an executor or administrator.

Generally, an executor is a friend or member of the decedent’s family, but doesn’t have to be. Sometimes an executor is appointed by the court, usually an attorney with experience in estate matters. It’s the executor’s job to pay all of the estate’s debts, distribute property and file the tax returns. In return for these efforts, an executor is compensated; the amount of compensation is governed by state law.

Fantastic Finds  Fantastic Finds, edited by Eric Bradley

Upon an individual’s death, the will must be filed at the courthouse to begin the probate process. Once an estate has been opened for probate, there is a continuous stream of paperwork that must be submitted to the court by the executor. Such paperwork becomes part of the probate records.

The filing that is of most interest to antiques dealers is the estate inventory, which lists all of the assets of the estate — both titled property (autos, boats, real estate) and nontitled property (artwork, jewelry, cash, collectibles, antiques).

Typically, inventories must be filed within 45 days of the date of death. Probate records are a matter of public record; anyone can view them. Antiques dealers can have full access to a list of the estate’s collectibles and know what’s coming to market months ahead of anyone else, simply by researching courthouse probate records.

What you’ll learn from looking at probate records:

1. The names and addresses of the executors and heirs and the location of the assets.

2. If the estate is likely to have cash flow problems. You’ll learn how much cash is on hand to pay bills and if there are securities that can easily be liquidated to raise cash.

3. If there are antiques and collectibles available that might be for sale. You’ll also learn which heirs will be inheriting which antiques, and their addresses. Don’t be concerned if an item of interest is already assigned; you never know how an heir will respond to an inheritance. If the decedent’s niece decorates her home in Zuo Modern, it’s unlikely that she’ll be interested in a living room full of Victorian furniture. There’s nothing she’d like better than a cash offer from an antiques dealer.

The weaknesses in the probate system that can be pursued by antique dealers:

1. Often, there is not enough cash in the estate to pay ongoing expenses and settle debts. If there is a home, mortgages and utilities must be paid, grass has to be cut and the home maintained until it can be sold. When an estate is heavy on assets and short on cash, smaller assets (like collections) will sometimes be liquidated to pay bills until the larger assets (like the home) can be dealt with.

2. Being an executor can be an overwhelming job, and virtually all executors need help to get the job done. Most executors are not professionals, and they don’t have a clue what the household items and collectibles are worth or how to get an estate inventory done.

3. Families are busier and becoming more spread out. On top of the 15-20 hours per week that executors spend closing out an estate, they have jobs, families and personal commitments. Sometimes, they live out of state (although courts can choose to appoint an in-state executor).

In short, most executors are overworked and short on cash. Anything you can do to make their job easier is usually appreciated.

Here’s a three-step plan to mine probate records to find antique inventory:

1. Become familiar with the records department of your county District Court. This is where the probate records are generally kept. Probate filings are listed in the public records notices of your local newspaper; that’s where you will find the names of the decedents. County Clerks are there to help the public gain access to the records, and most are very friendly. If you live in a large metropolitan area, it’s likely that your courthouse records are available online. Sometimes online access is free; sometimes it isn’t. Whether you search records in person or online doesn’t matter; you’ll find the same information.

2. Understand your competition. Few auctioneers, antiques dealers and estate sale companies work probate records. Such companies tend to be reactive (wait for someone to call them) rather than proactive (search probate records). However, there are companies who are not in the antiques business that actively pursue estate executors; they are called probate liquidators. Learn who the probate liquidators are in your city and what services they offer.

3. Develop a systematic approach for contacting executors and heirs. I won’t suggest a system, because you have to be comfortable enough with whatever you devise to be willing to apply it regularly. Hit-and-miss marketing delivers hit-and-miss results. If all you can do is a monthly postcard mailing, then that’s what you should do, but do it every month.

You’ve heard of lawyers who are ambulance chasers? Don’t become a hearse-chaser; it will negatively affect your reputation. Unless you plan to offer executors your help to do the estate inventory, wait for the inventory to be filed before you make contact with anyone. When you do make contact, be sensitive to the fact that a loved one has recently passed away.

Dealers who conscientiously pursue probate records (especially those who are fortunate enough to have online courthouse access) will find that they spend less windshield time acquiring new inventory. And, their competitors will wonder how they keep getting the best deals.

Wayne Jordan is a Virginia licensed auctioneer, certified personal property appraiser, and accredited business broker. He specializes in the valuation and liquidation of estate and business assets. His column Behind the Gavel appears monthly in Antique Trader. Learn more at www.waynejordanauctions.com, 276-730-5197 or auctioneer.wayne[at]yahoo.com.

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