Whenever anyone inherits a house, it can be either of two things; a gift or hurtful amazement. It is often said that landed properties are far more valuable inheritance than a fat bank account. So while there might be a bit of sadness or grieving attached to inheriting a house, you can make the experience worthwhile. This is why we have decided to walk you through 3 things that answer the question; What to do when you inherit a house with no mortgage?
Every inherited property has to go through a phase called Probate, without which you cannot sell/rent out the house. Summarily, the legal process of determining if the deceased’s wishes were authentic is Probate. Asides from proving the authenticity, it also ensures the wishes are carried out to the word. Furthermore, because we now have “last will/testament,” it becomes easy to share the deceased’s precious personal items and have the ownership of their property successfully passed to others.
The probate process varies from state to state, and properties can be dealt with accordingly after it has been completed. As an heir, you can now sell or utilize the property depending on what you choose to do with it. Remember, it’s now yours legally! However, some states allow the passage of ownership immediately if you can provide a quick claim deed. A quick claim deed is a document that names you as the beneficiary or payable on death. Overall, every inherited property is downright passed to the heirs by Probate even though there is no mortgage on the property.
In rare instances, people choose to hold on to properties and utilize them; however, many consider selling inherited properties as the best way of moving forward. Read on to discover three things you can do after inheriting a house that is paid off;
What To Do When You Inherit A House With No Mortgage
1. Sell the Inherited Property
This is coming first on our list because it is usually most people’s way out of a wanted or unwanted inheritance. In the case of the death of loved ones, you could decide to sell the house and move on without looking back.
You can decide to follow this option for several reasons; need the extra cash? Live far away now and cannot maintain the property? And many more. In situations where it is not only your decision to make, you should sit down with your siblings and consider other options.
One of the benefits of selling inherited property is the profitability of the deal. If the house has been in existence for a long time, there is a possibility that it has appreciated; therefore, you will be gaining more from selling the inherited property than holding onto it.
If there is an agreement between yourself and your sibling to sell the house, everyone will benefit from the sale as the proceeds will be shared evenly. How about when there is disunity about the sale? Maybe your siblings would like to keep the house, and you prefer to sell or vice versa. The best thing to do is resolve the matter outside the confinements of a court or without getting legal practitioners involved.
This is a reasonable thing to do because you do not want to incur extra costs for inheriting a house. However, getting legal counsel involved would mean you all have to spend the extra money, and benefiting from the inheritance would not be possible if you spend all your money trying to find a way out.
2. Renting The Home
This can be a middle ground for disjointed families who have siblings who do not want to see their precious inheritance owned by someone else and those who prefer to sell it off. This is a great way to remain owners of your inheritance yet, earning a passive income from it.
As much as it is not your dream to become a landlord, everyone loves to earn a passive income. You can put the house up for rent and enjoy monthly payments for as long as you want. However, renting your inherited property also has its downsides; you can end up with bad tenants who destroy the home and always need repairs. This would mean extra costs for you.
Being a landlord is not what everyone can do; in that case, hire a property manager. This would mean you don’t have to deal with tenants or put the house up for rent; you only get to enjoy monthly incomes.
Renting out the property can be a short-term decision till you all agree to sell the property. In that case, you will not be a landlord for long.
3. Living in an Inherited House
This is usually a more convenient option if you are the only child or the property was given to you alone. People often want to sell or rent out an inherited property; if you are not among such people, living in an inherited house is an option worth considering.
At Probate, you will confirm that your parent’s house is entirely debt-free. You do not want to spend moments after grieving paying debts. If there is no mortgage to pay, be ready to pay property taxes, insurance, and the necessary upkeep costs. All of which you would have to pay if you were in your own house or paying rent at another’s.
Furthermore, prepare a budget for repairs and turning the home around to suit your taste. If your parents lived in that house all their lives, you might be looking at a considerable budget here. If you have siblings with who you inherited the house together, prepare to pay them off.
Undoubtedly, you now know what to do when you inherit a house with no mortgage. However, the ball is in your court as to which of the three you decide to do. Having a property passed down to you can be stressful, especially if you never saw it coming. One way to avoid this is to discuss with your parents while they are still here and how best to handle their house when they are gone. It is not far-fetched; at least, people choose their coffins before they die.