Do you want to sell an inherited property fast? Before placing it on the market, ensure that you’re the executor or the beneficiary. If you’re unsure, talk to an estate attorney.
A real estate agent will be vital going forward. As TrueNestPM.com explains, they will convey more information about the property and the proper listing price. Before selling the property, you’ll contend with barriers in the form of taxes and debts.
This article is an in-depth guide into selling inherited homes. Let’s explore.
Identify the Executor and Interested Parties
The last will and testimony will name the executor of the estate. The executor is the person who manages the estate and can sell the property legally.
In other cases, it can be a personal representative appointed to manage the affairs. A legal representative may be appointed through the will or the court.
The executor or legal rep must pay the decedent’s creditors as well. If someone dies with unpaid debt, the creditors must receive payment.
You don’t have to notify the creditors unless you’re the executor or legal rep. The executor must contact the creditors and use some of the proceeds from the sale to pay the creditors.
Additionally, determine if there are other inheritors who have a stake in the home sale.
You can find the executor and beneficiaries through one of to ways:
- Contact the Estate Attorney (Estate attorneys usually know the beneficiaries)
- Contact Your Real Estate Agent (A real estate agent can conduct a title search)
A title search will highlight judgments that you may have to contest in court. A complete title search can highlight other issues, such as tax liens, reverse mortgages, or equity lines of credit.
Address the Finances
If you inherited the property, you have inherited the debts as well. The property debts include mortgages and utilities.
A real estate agent can help you identify the mortgage on the property. The agent can also find out the remaining balance and how your parents made payments.
To pay the bills, you’ll need access to their bank account. You can forward their mail to your address and use the info from the billing statements to get the account information.
Know About Taxes
When inheriting real estate, you must worry about the tax implications. You must pay taxes from any income you receive from an inherited asset, otherwise known as an inheritance tax. Other types of taxes include estate tax and capital gains tax.
A capital gains tax is a tax levied on the selling of assets, such as real estate, stocks, bonds, etc. You may have to pay a capital gains tax if the value of the home appreciated since the owner first bought it. If you’re the beneficiary, there are ways to avoid paying the capital gains tax, but you should talk to a tax professional for more information.
An estate tax is a tax on the deceased person. As of 2021, the federal threshold for estate taxes is around $12 million.
If you’re confused about tax matters, you can also talk to your attorney for further guidance. Above all, a tax professional is advisable. They can help you reduce or eliminate any tax bill.
Coming to an arrangement will spare you the stress of prolonged arguments or legal hurdles. To ensure the home sale process goes smoothly, ask yourself the following questions:
- Who will stage the home for selling?
- How will you divide the proceeds?
- Who will pay the home sale expenses? (the executor?)
- Who can accept the offer?
- Will the executor allow me to sell the property?
The beneficiaries need permission from the executor to sell an inherited property. Likewise, the executor must receive permission from the heirs to sell. It’s not uncommon for the executor and the heirs to disagree over what to do with the property, which is why these matters often end up in court.
Therefore, try to come to a pre-arrangement if possible. To alleviate the situation, you can ensure that everyone is included in the process. For instance, you can list which beneficiary will be responsible for a certain task.
Finding a Mediator
One way to avoid a messy legal entanglement is to find a mediator. A mediator can be an estate attorney or real estate agent. When finding an agent, find one who knows about the probate process.
Whether the home is in a trust or going through probate, you need an experienced agent. If possible, try to find an agent who has dealt with cases similar to yours. Also, find an agent who operates in the same city.
Prepare the Home for Sale
You have two options when selling the property:
- Prepare the home for Sale: This may include staging, repairing, or renovating the property before selling it.
- Selling the home as-is: You don’t have to conduct major repairs or renovations if you sell the property as-is. However, you must disclose glaring issues with the property.
Disclosure guidelines tend to be more flexible for inherited real estate, but you could be liable in some cases. The liability depends on how you inherited the property.
Overall, you must determine the proper list price. Your listing agent will suggest a suitable price. They will use comps to compare the value of the property to similar homes sold within the area.
Sell Inherited Property without Hassle
To sell inherited property smoothly, determine who the executor is and all the beneficiaries. From there, ensure that all parties sit down to work out an agreement. Consulting with one another beforehand can prevent legal battles.
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