What to do When you Inherit a House

When inheriting a home you are faced with many difficult decisions and a range of emotions.  The first thing to remember is that you have time and you should use that time to make informed,  not emotional decisions.  It is important that you speak with professionals because you do have options and depending on your unique situation, each one could be right for you.  You basically have 3 options:
​1) You can move into the home. 2) You can rent out the property. 3) Sell the home.   Lets take a look at each one a little closer.

First things first (the disclaimer). This article is not intended to give legal advice and we strongly recommend consulting an attorney before making any decisions. 
Before you consider any of your options, it is imperative to have a clear picture of what the situation is for the property.  This means doing your homework and handling the paperwork.  You need to know that status of everything starting with the insurance.  Is the current policy up to date and paid in full?  Or does there need to be a policy change to reflect the current situation?  Next,  consider mortgage and taxes.  Check to see if they are up to date, if they are escrowed or paid separately, and if they are behind on payments, how much?  Has the foreclosure process started yet?  (for help understanding foreclosure,  click here read our article). 

Next check the status of the bills. There are plenty of them. Utilities such as electric, gas, water, heating (does the house use propane or fuel oil), cable, internet, phone, etc..  Is there a line of credit attached to the house or any liens that have been placed on the property for unpaid bills or loans?

You should also perform an inspection of the house to assess it's current condition.  You can break these down to 3 simple categories: 1) Safety issues, 2)Needs and
3) Wants.   Safety issues should be addressed right away.  Some things you would be looking for are things such as  exposed wiring, loose stairs or railings.. really anything tha,t could cause injury.  Needs are not as urgent but depending on what it is,  you may choose to address it right away or wait to see what you decide to do with the house.  A leaky pipe for instance, you would probably want to fix right away so it doesn't cause further damage or you get mold.  You may need new carpet but in the main time you can make do with what is there.  And wants are just that, things you would like to do and they can generally wait for the time being. 
Now that you have a clearer picture of the situation, this will hopefully help you choose which option is best for you.  

Move In
If you choose move into the property, it is a good idea to consider a few things.  First get it inspected by a professional.  You have done your inspection but is is a good idea to have a second set of eyes take a look.  If you are not selling it then you do not need a full report and many inspectors offer a scaled down version that only cost a few hundred bucks and is well worth the money.  Also because in many cases it has been some time since the taxes have changed, expect the house to be re-assessed which means a potential increase in taxes.  This would cause your monthly expenses to be higher than what you may have originally expected.  There is also the consideration of other siblings or heirs that need to be bought out.  If you have a sibling then they are entitled to 50% of the home.  In this scenario,  you could have to have the property assessed for value and then compensate your sibling for their half of the home.  Remember to subtract your costs on this as well to split the cost of those expenses!

Rent It
Another situation would be to keep ownership of the property and rent it out.  This could be a good income potential for you.  Be certain  to run the numbers and make sure that the income would be greater than the expenses.  If you live in the area, you may consider managing it yourself but if you don't, there are always property management companies that can do it for you for a fee.  Remember tenants can be difficult and can cause major headaches,  so if you out of the area this would be a good idea.  Make sure you get a landlord insurance policy on the house as well.  One thing to consider if the house is a vacation home is that you could always rent it out using companies such as VRBO®, Home Away™ or Airbnb for extra income and keep it for your use as well.

Sell The Property
The third option would be to sell the home.  If you just aren't interested in being a landlord and don't want to live in it, then this might be the most ideal option.  Also note that if the property is behind on expenses such as mortgage or bills that you found in your initial assessment phase, then this could be cleared up when you sell the property.  If you are going to keep possession of the house either to live in or rent out, then  any past bills, expenses, or liens need to be paid off.  If you don't have the cash, then this could be an issue. 

We have experience in purchasing inheritance houses and would be more than happy to take a look at your unique situation and give you our professional assessment.  We have done this for people all over the Capital Region including  Glens Falls, Queensbury, Clifton Park and other areas.  Visit our website at:  www.chrisandginabuyhouses.com  to learn more about how we can help, or click here and fill out a form so we can get in touch with you even if you just have questions that  we would  be able answer.   We would love to hear from you!

Chris and Gina