How do you know when a property should go to probate? Typically, if your loved one has a Will, the estate may need to go through probate before selling it. Depending on where you are, the probate process can take several weeks to complete. Once you conclude the process and have all of the necessary documentation, you can sell your inherited property. For anyone that has questions on this process, feel free to call us today to learn more about the probate process.
4. Determine If There is a Mortgage
Although this is step #4, you should try to do this soon after inheriting the property. The reason being is that you/your family may be responsible for paying the mortgage moving forward. This information is fairly easy to find. If the deceased has any lender or mortgage documentation, you can call that bank and find out more information about the property.
Selling an inherited property with a mortgage
There are a few things that you should look for when getting ready to sell an inherited property with a mortgage. All mortgages can vary regarding terms, rules, and regulations. Mortgages come in various amounts. Sometimes, families will inherit a property with a sizable mortgage on it. Other times, there won’t be any! Either way, it’s important to stay on top of this financial information regarding your inherited home. This will help you and your family stay as organized as possible throughout the process.
Due on Sale Clause
If the existing mortgage has a due-on-sale clause, the entire loan is considered ‘due’ if the borrower transfers the property to someone else. Fortunately, when someone inherits a home, they can normally assume the mortgage payments (aka pay for the mortgage payments themselves). This is MUCH less stressful than having to pay the entire loan off at once. Again, talk to the bank to determine how they work.
The property I inherited is underwater
Unfortunately, sometimes people inherit properties that are underwater. This means that the total loans on the property are worth more than the property itself. If this is the case, talk to the mortgage lender to determine the proper strategy going forward. Oftentimes, they’ll let you do a short sale. This means you can still sell your inherited house by accepting less for the property than the outstanding loan debt. This usually isn’t considered a ‘win’ from the family’s perspective. If you need to sell an inherited property that is underwater, give our team a call today. We will make you a competitive cash offer that ideally puts you in the green!
Inheriting a house that is paid off
This is the best-case scenario. Some families inherit a home that is entirely paid off. That means the ball is in your court. There are no outstanding debt holders that you need to answer to before making your next move. If you have wondered how can I sell my inherited house fast, having no debt on it helps. For families that want to calculate their bottom line of how much they would make when trying to sell their inherited home, fill out our form today.
Are there other outstanding debts?
Another good step to take when preparing to sell an inherited property is to calculate other outstanding debts besides the mortgage. Other outstanding debts on a property can include:
- Property taxes
- Hospital lien
- Divorce lien
- Federal tax lien
When we buy inherited houses, the Title Company we work with will run a comprehensive title report. This will pull all associated debts tied to the inherited property. SO, don’t feel pressured to account for every penny owed on the home. The title report will also pull that information. This is the first step that we take when buying houses once we sign an agreement. When the title report comes back, we review it with the families to answer questions and clarify what is what!