When that house becomes yours, figuring out what to do with it can present financial and emotional issues. If your siblings are involved, things can get even trickier. Should I rent it? Should I sell it? How should I sell it? Tons of options open for you, but…… we can help.
I Inherited A House, What To Do Next?
Here are a few important considerations to help you make the right decision:
- Deciding whether to move into it, rent it out, or sell it
- The financial and legal responsibilities including debt obligations
- The tax liabilities (federal estate taxes or capital gains included)
You may be able to keep the house and let the rental income pay the mortgage if there still is one. However, if you’ve never owned a rental before, you may be a little overly optimistic about how much money you’ll make. There is a lot of risks of renting out property such as bad tenants, repairs, depreciation, and other expenses.
Making your decision
When a property is inherited, you still have to pay the mortgage, taxes, and any other ongoing maintenance and upkeep costs. What if your inherited home has deferred maintenance, needs lots of expensive repairs, or is a hoarder house? Should you fix the home and sell it, or just sell it as-is? When selling a house as-is sale, the buyer buys the property in its current condition. This saves you from having to spend any money on repairs or cleaning.
You can choose the traditional route, or you can sell to an investor who buys homes as-is. It’s important to evaluate the number of repairs prior to selling. Then, the number of costs and time it will take to repair and sell.
If time is important and family members want their inheritance quickly or simply to not have to go through everything that was left in the house, selling to an investor may be a better choice. Investors buy homes, as-is, with minimal inspections.
Getting a fresh coat of paint and carpet may be all you need in order to get the most dollars for your inheritance when selling traditionally. For just a few thousand dollars, you may be able to spruce up the home giving it a fresh, clean and appealing look for buyers. In the case where your home needs lots of repairs, you may not get top dollar unless you’re in a seller’s market. It may also take longer to sell your home because of the condition, even at a discounted price.