You are grieving for a loved one who just died, then you learn that you've inherited some property in Arlington--perhaps the house that the deceased lived in. What do you do?
House with wide front yard
Here are four specific steps that you'll need to take if you inherit real estate.
Step 1: Meet with a probate attorney
The first thing you should do when you learn that you've inherited property is to meet with a probate attorney who has assumed the various rights and responsibilities associated with the property. By doing that, you will be able to asses the full picture of what you've inherited.
"Find out if there’s back taxes, liens, HOA dues, or other liabilities you’ll be assuming," says Nate Smoyer, director of marketing at Avail. "Find out if there are any specific covenants regarding the property and its future use."
Step 2: Hire a property inspector
Experts recommend treating the inherited property as you would a real estate purchase. Before buying a house, you would have it inspected. You should also do the same with a home you inherit.
"This usually costs between $400 [and] $600, but it could save you a lot of headaches," says Smoyer. "Oftentimes, a real estate agent can be a great source for finding a recommended inspector."
Step 3: Find out if there are any obligations attached to the property
Ideally, the inherited property will be paid off, but this may not always be the case. Real estate attorney Adam Gutin says learning of any obligations on the property—including mortgage payments—is key.
"When a person inherits property, they are naturally going to want to know how much it is worth," he says.
"However, the other question she should ask promptly is whether there are any ongoing or imminent obligations that need to be performed with respect to the property, such as payment of assessments or property taxes, or landlord-related obligations."
While a family member or representative from the estate will usually have these answers, you may also need to hire professionals such as a real estate broker, property manager, or real estate attorney to help.
Step 4: Decide whether to sell or keep the property.
Now that you have all the information, you'll need to decide what to do with the inherited property.
"Determine the property's current market value for both renting it and selling it," Smoyer says. "Inheriting a property can give you a significant boost in building long-term wealth. It may be tempting to sell off, but consider the long-term cash-flow potentials if you were to rent it out. Talk through your options with a trusted local real estate agent."
Experts say that most people who inherit real estate ultimately opt to sell.
Terrence Freeman, an attorney with the South Florida firm Nason Yeager, says that's because many beneficiaries don't want to take the time and money to maintain the property.
In cases where several people jointly inherit property, there're three basic options to follow. First, you can opt to keep the property and own it together. Second, one person can buy the other(s) out and take full ownership. And finally, you can sell it and share the profits.
Experts agree that the third option usually prevails.
Charity W. is a professional and skilled writer with a diploma in Mass Communication. When she is not glued to her computer screen, Charity spends her time reading, traveling, and watching movies. She is an expert on Arlington Virginia and keeps current with local events and occurrences.
