What to Do After You've Inherited Property

By Ted Ricasa

VIDEO: How I Squandered My Inheritance

If you have recently inherited a home from a loved one, you are possibly confused as to what exactly to do with it.  The situation becomes even more confusing and potentially frustrating if the will stipulated multiple heirs to the home.  Moments of clarity are probably few and far between.

In all likelihood, your loved one left the home to you in good faith, with the expectation that either the home itself or its sale would be of benefit to you.  In many cases, however, heirs to homes end up inheriting an overwhelming amount of unanticipated difficulties and headaches.  Whether your goal is to live in the home, rent it out, or sell it, the best way to honor the memory of your loved one is to make the decision that effectively protects your interests and the interests of your community.  In order to do that, however, you must first know your rights and options as the owner of an inherited home.

Can we help?: Request a cash offer for your inherited home

I recently inherited a home from a parent.  Can I assume the current mortgage on the home?

mortgage contractIf you decide to live in the home, you will most likely be allowed to take over the current mortgage.  However, if you intend to rent the home out to someone else, the lender will probably require you to refinance in your name.  If a reverse mortgage was taken out on the home, you cannot assume that mortgage.

Before you make the decision either to live in the home or to rent it out, be sure to investigate and carefully consider whether you can afford the mortgage, as well as the taxes on the property and other expenses associated with owning the home.

More: Find Out Which Taxes Affect Your Inherited Home

I inherited a home along with my siblings.  What happens if we cannot agree on what to do with the property?

siblings looking at paperMost states consider multiple heirs to a home “tenants in common.”  As such, any one of the heirs can force the sale of the home if he or she is so inclined.  When this occurs, it is usually the result of a heavy strain on the familial bonds, whether due to money issues or a disagreement as to what should become of the home.

The death of a parent can have a devastating effect even on adult offspring.  It is in the best interests of siblings in such situations to communicate openly and respectfully with each other and try to arrive at a unanimous decision regarding the home.  Without consensus, heirs face a potentially long, drawn-out, and very expensive process that often results in their having to maintain a vacant house for far longer than was necessary.

What is the “death tax”?  Will I have to pay an inheritance tax?

tax papers and calculatorThe so-called “death tax” is the informal name, popular in the media, given to the federal estate tax.  As of January 1, 2013, the amount that can be excluded from the estate tax was raised from $5.12 million to $5.25 million.  If the value of the estate exceeds $5.25 million, only that excess amount will be subjected to taxation, at a maximum rate of 40 percent.  The heir or heirs are not responsible for paying the estate tax out of pocket; the tax must be taken out of the estate before the beneficiaries can receive their inheritance.

A small minority of states currently impose an inheritance tax.  If your state requires the payment of inheritance tax, that tax will be split among the beneficiaries.

It is important that you know and understand the state and federal tax laws that may affect your inheritance as well as the potential sale or rental of the inherited home.  While it is beyond the scope of this website to provide tax information for every possible circumstance in every state, if you decide to work with Fast Home Help, we will make sure that you understand the relevant tax laws thoroughly before you decide how to proceed.

More: Seven Reasons to Work with Us

Can I refuse to inherit a home?

couple looking sad and reflectiveIf you are in line to inherit a home that is worth less than is owed on it or is at risk of foreclosure, you can file a written disclaimer refusing inheritance of the property.  However, you must do so within nine months of the death of your loved one, and you cannot have benefited from the proceeds of the home in any way.  Once an inheritance is disclaimed, it cannot be reclaimed.

It may be in your best interests to disclaim an inherited home if:

If you disclaim an inherited home, you do not get to decide the next in line to inherit it.  That determination is made by the probate court, guided by state law.

More: Probate and Property Issues: Clarity in a Confusing Situation

If you are unsure as to whether you would be better off selling your home for cash or disclaiming it, we encourage you to contact Fast Home Help.  We will let you know whether we can make you an all-cash offer or whether filing a disclaimer is your best option.

What are the advantages and disadvantages of selling an inherited home for cash now versus going through a Realtor?

If you have decided to sell your inherited home rather than living in it, renting it, or disclaiming it, there are a number of options available to you.  You can go through traditional channels to attempt to sell the home, or you can request a cash quote from Fast Home Help.  As to which decision would be in your best interests, it depends entirely on your circumstances.

It may be advisable for you to sell the home through traditional means if:

On the other hand, you may want to request a cash quote from Fast Home Help if:

More: Short Sales: Your Options As a Homeowner

The purpose of Fast Home Help is to provide assistance to people just like you, people who are facing difficult decisions regarding their homes often due to circumstances beyond their control.  To learn more about your options and rights as the owner of an inherited home, please contact Fast Home Help today.  We can help you make the decision that is best for you, your family, and your community.

Can We Help You?: Request a Property Privacy Audit™

Michael M.The transaction went smoothly and we closed in 2 weeks, allowing me to cash out and move on with my life sooner than any other way of selling. I highly recommend Ron to my friends, my neighbors and to you! Thanks Ron! - Michael M.

More: Testimonials from Satisfied Homeowners

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