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Inherited a House? What to Do Now

When you inherit a house, you’ll have a lot to do, but also a lot of options. Fortunately, there is a lot of helpful advice available online, including this post from the National Association of Realtors’ Houselogic site, this article from The Learning Channel’s series on dealing with inheritances, and this post from Realty Times. You can consult those articles for more information and resources, but to help you get started, here are the four major steps you’ll need to follow:

1. Work with the other heirs and family members. The greatest danger in dealing with a house inheritance is that it can cause major rifts in your family. You may have inherited the house in common with other heirs—usually your siblings, if you’ve inherited your parents’ house, or your cousins if you’ve inherited from a grandparent, aunt, or uncle. Everyone will have their own opinion on what to do with the house, and everyone should have a say in the final decision. It is possible to legally force the sale of the house if the heirs can’t agree, but this can cause lifelong hurt feelings. Work together if you can. Also remember that other family members may have fond memories and strong feelings attached to this house. Ultimately, it’s up to the heirs to decide what to do, but let the whole family know that you’ve carefully considered their feelings, too.

2. Get professional tax and legal advice. Each of the articles listed above mentions current estate tax law at the moment the post was written, but tax law changes fast. You’ll need to find out how to legally transfer ownership of the home to you (and any other heirs), pay estate taxes, and deal with any other financial and legal issues. If the house has a mortgage, reverse mortgage, or liens on it, you’ll need to make a new deal with the creditors before you can take ownership. If the debts surrounding the house are big enough, the entire house may go to the debtors, and not to the heirs at all. There are many legal and financial variables to sort through, and your house’s situation is unique. Get help to sort all of this out.

3. Deal with the house’s financial needs. Beyond estate tax and debts, there are a few other financial considerations to know about before you make your final decision. It’s important to keep up the homeowner’s insurance policy in case anything should happen to the house while you’re sorting through the red tape. This post from Insure.com will walk you through the steps to keep the house insured. Once insurance is taken care of, your house will likely need some repairs before it’s ready to for you to sell, rent out, or move into. If you’re thinking about selling the house or renting it out, consult a real estate agent to find out what you’d need to repair and update. Get your tax advisor involved in these decisions, too. Improvements you make after inheriting may affect the amount of capital gains tax you’ll have to pay.

4. Sell it, rent it out, or move in. Once the house is yours, you’ve got all of the information you need, and you’ve consulted with other heirs and comforted the rest of the family, it’s time to make your decision. Your situation is unique. Do what’s best for you and your family.

The Staff at San Juan Realty, Inc.

for sale 631 Sherman Street Downtown Commercial Ridgway Colorado

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