What does intestate mean regarding a property owner's estate?

Intestate refers to a situation where an individual passes away without having a valid will in place to dictate the distribution of their estate. When a property owner dies intestate, their assets are distributed according to state intestacy laws, which generally outline the hierarchy of heirs and how the estate will be divided among them. This can lead to various outcomes depending on family circumstances, such as the distribution going to a spouse, children, or other relatives.

Understanding this term is crucial for those studying for their broker licensing, as knowledge of intestacy laws can impact real estate transactions, especially when dealing with estates or inheritance issues. The importance of having a will is emphasized by the complications that can arise in intestate situations, including potential disputes among heirs or delays in the distribution of assets.