First, we’re so sorry for your loss. This can be a very challenging time for many reasons, and dealing with property ownership is tough at the best of times.
Often times inheriting a house comes at a time when there is a lot of mixed emotions. You are in the process of dealing with a loss, you might have already had to take a lot of time off from work if you were caring for a loved one that was ill and now you have to deal with property. One of the most important items to start with is making sure you continue to pay the mortgage if there is one, and taxes. Banks don’t care who makes the payment so long as the payments continue to be made. This will keep loan up to date so it doesn’t start to go down the road to the foreclosure process. The second item to begin to look into is heirs of the property. If there is a will, the will will need to be probated. This can take a little time so make a plan to continue to make sure the mortgage and taxes stay up-to-date. If there is no will, the property will belong to the direct descendants of the person that passed away. There is a process called and affidavit of heirship that will help define who those descendants are. The next item will be a decision on whether to keep the house or sell it. Sometimes this gets tricky if not all the heirs are in agreement. If there is not a will in place and the affidavit of heirship was required, it will require unanimous consent from all the heirs. We can help sell inherited houses in cities all across Texas, and even help you decide whether or not you should sell it – with all factors involved.
If you have questions with any of the information we have covered, feel free to contact us at 512-309-1991. We work throughout all of Texas and can help you work through this process step-by-step. We specialize in working with properties with multiple heirs and working with families even if they are not all in agreement on the best solution yet. We can also help with affidavit of heirships and getting you started in that process.
I Inherited A House, What To Do Next?
Here’s a few important considerations to help you make the right decision:
1) Make sure the mortgage is paid.
This may sound obvious, but if the person who left you a property also had a mortgage (unless it had no mortgage and was paid off, which is great!), you have to pay it (assuming you want to keep the property). Some banks will allow you to assume the loan, while others may force you to refinance into a new loan. If you don’t qualify for a new loan, renting may not be an option for you.
2) The investment is only as good as the manager.
If dealing with brokers, maintenance, tenants, rent collection and all the nuances of property management isn’t the best use of your time, hire a professional to help you or cash out now. Some people who inherit homes decide to keep the house and rent it for extra income. That’s a great strategy for sure. You just need to be prepared to manage the property and the hassles that can go along with tenants and toilets.
3) Property ownership costs money.
It’s rare to see a building that’s been perfectly maintained. Most inherited houses need major improvements.
Consider hiring a professional property inspector to give you a detailed rundown on what you’ll need to do within the next five years, along with estimated costs. Surprises are very, very expensive.
4) Selling a property for top dollar costs money.
If you don’t want to deal with making repairs, updating kitchens, improving landscaping and overall cleanup, don’t worry. We buy Texas houses for cash, as-is.
5) If the market will continue to grow faster than your other options, hang on to the investment.
We can help you analyze the value of your property today versus the long-term benefits of renting. If you can use the equity in your property in another way that outpaces the performance of the real estate market, you should. If you don’t have anything better to do with the money and the neighborhood is rising in value, hang on – real estate can be a great investment if you know how to correctly read the market.
6) Uncle Sam wants a piece of the action.
Don’t forget to discuss your inheritance with tax and legal professionals before you take action. There are major property and income tax consequences that will dramatically impact the cost of owning your investment.
7) Consider all your options.
In certain situations we may be able to help you structure a lease-option agreement that allows you to rent and sell at the same time – capturing the best of both worlds. These kinds of deals can be complicated, but our Austin investment experience can help you win.
8) Compare a few scenarios.
We’ll help you determine prices for any property near Austin – if you sold it today without doing any work, the highest price the market will bear, and the projected value of keeping it as a rental (along with the costs).