Posted April 8, 2024

What happens when you inherited a property?

Inheriting a house sometimes can be a mixed bag, as usually the generous gift is a result of losing a loved one. And the financial decisions which come for inheriting the property can be quite confusing, as well as mentally and emotionally stressful.

The best way to move forward is knowing your options, assessing the financial consequences of your choice, and seeking expert assistance in navigating the tax and legal requirements.

Many variables are to be considered when inheriting a home. What is its current market value? Does it have outstanding mortgage debt or tax implications, and if so, are there any capital gains costs? Are there multiple stakeholders in the inherited property? What condition is the property in and does it require extensive repairs? If you are finding the commitment of an inherited property is too much for you, then the best option may be to sell. It can be listed through a real estate agent, sold ‘for sale by owner’, or sell it to a real estate investor.

Before you decide how to sell the home, you must first determine the fair market value of the property. A rough estimate of value can be found using online tools such a ‘Zillow’ or ‘Redfin’ in researching similar properties in the local marketplace. However, managing your expectations of whatever the estimated amount is, does not necessarily mean that you'll get paid exactly that. These algorithms are not perfect as they cannot measure the different aspects of your home adequately. These unknown factors, such as the condition, locational influence, and any unknown amenities (pool, views, etc.) of the property can greatly impact its value, negatively or positively.

Another unforeseen obstacle in selling the inherited property is, did the loved one leave a legal will? If not, this process will also take time, and perhaps hiring a probate attorney or estate planner may be necessary in resolving these legal issues.

If your loved one did leave a legal will and designated someone to be responsible for distributing assets, choosing an executor is unnecessary. However, in instances where the siblings inherited a property and the parent did not state who should manage the sales and other transactions, the siblings should meet and appoint someone to have the ultimate authority of ownership.

Disagreements in deciding whether to sell the property or not often arise when a lot of individuals inherit a single property. These disagreements could even lead to many arguments.

To avoid this, a mediator or an attorney can help sort through family disagreements so you can arrive at a decision on whether to sell the house.

How to sell an Inherited House?

After considering all the scenarios mentioned above, it is time to sell your property. Next, you will want to choose how to sell it. As mentioned previously, you can hire a real estate agent, sell it ‘for sale by owner’, or sell to a real estate investor.

For obtaining the highest value for your home, a local and knowledgeable real estate agent can best represent you in negotiations, setting the appropriate sale price, and market your home properly.

And although you may have decided to list your inherited property for sale, it may take several months before the sale is finalized while it goes through the title, escrow and mortgage loan processes. And during this time, you still have to pay for its utility bills; electric, water, cable, and trash removal, for example. And if the house has an outstanding mortgage, that must be paid on time, since you are the new owner. Additionally, other expenses may be incurred as the property must be well maintained or improved upon during this waiting period.

Also, when selling with a real estate agent, a professional home inspection is required before the transaction is complete. The agent must disclose any potential problems to the prospective buyer. They could be minor issue such as stained or worn carpeting, or more serious complications like cracked foundations, leaking roofs, rotting structures, leaking or broken plumbing, etc. These important repairs can greatly affect the negotiations between buyer and seller, and delay the closing of the sale due to any needed rehabilitation of the property.

If you are not in a rush, and have the funds for any required repairs, you can sell you inherited ‘for sale by owner’(FSBO). Without the help of a real estate agent, you can save yourself a significant amount of money as you will not have to pay any real estate agent commission fees. But, even if you decide to go this route to sell it on your own, you should have a good understanding of the real estate industry and local market, at the least. Pricing the home too high can delay the sale, forcing you to make unwanted mortgage payments, and pricing it to low can result in a less than desirable profit. And as with hiring a realtor, it is highly recommended to allowing the buyer to obtain a home inspection to discover if the house is in need of a lot of repairs, or not.

A real estate investor, however, can give you a cash offer in a matter of days, usually within a week or so. They will buy the property as-is without any needed repairs or house clean up, and no home inspection required. And since it is a cash offer directly from the investor, there is minimal paperwork involved in closing the deal.

If you need help selling your inherited property, contact us at webuyhousesfastsocal.com. Or reach us at 818 573-0860 to get a quick cash offer!