Coping with the passing of a loved one can be extremely difficult. As you’re grieving your loss, you may have important decisions to make regarding your loved one’s property and belongings, funeral arrangements, and finances.
If you’ve just become the owner of a house or houses you didn’t expect to have, you have some decisions to make. What exactly should you do next if you have inherited a house in Dallas / Fort Worth? Consider these helpful tips to work your way through the process and guide your decisions.
First things first. Establish if your loved one has left a Will. Who is the executor of this Will? If there is a will, it must be filed for Probate. This needs to be done especially if the house is the only asset. The law requires that if they are going to probate the Will, it must be done within four years of date of death. Depending on the complexity of the estate, it could be as quick as 60 days. Probate could take as long as two years if it is a very complex situation with heirs that are fighting or missing.
If there is no Will, the next of kin would need to complete an heirship affadavit. A Texas Affadavit of Heirship is a simple form used to transfer property instead of going through probate when a person dies without a will.
Once the above is established and complete, you can now decide what to do with the inherited property. You basically have three options if you’ve inherited a house in Dallas / Fort Worth. You can keep the house, you can sell the house, or you could try to rent it out. Is there a mortgage?
If you decide to Sell the House you Inherited
Consider your timeline. (You may not live in the area where your loved one passed)
Consider any work the house needs done to it. Do you have time / money to make repairs? Can you afford carrying costs while it is on the market (mortgage, taxes, maintenance and upkeep, etc.)?
Figure out the value of the home and the equity that has been established.
Determine what will happen to all the belongings inside the home (estate sale?)
If you decide to Keep the House you Inherited in Dallas
You can continue to make mortgage payments on the house. Contact the loan servicer to let them know of the change – you’ll need to verify that you are the rightful heir to the property. You could pay off the mortgage – get the details about what equity is in the home and what is left on the note. If you cannot payoff the mortgage, check into refinancing to see if you could save money on the monthly payments. Make sure homeowner’s insurance is paid and current.
Be mindful of estate taxes. If you sell the house later on for more than its value at the time of your inheritance, you’ll owe capital gains tax on the increased amount.
If you decide to Rent the House you Inherited
In this situation you will need to first change the insurance coverage to protect yourself, the home’s belongings, and the renters that may be on the property. Who will manage the property? Designate an individual or hire a firm. It is best that the property manager be in close proximity to the house for any maintenance calls or periodic check-ins.
Consider any work the house needs done to it to make it suitable for living and attractive to renters. Do you have the time and money to make repairs to get the house in rental ready condition? Do you have reserves for owning rental property?
If you’ve recently inherited a house or houses in the Dallas/Fort Worth area and want to explore your solutions, call Reddtrow Properties. We have quality connections with estate professionals, attorneys, and tax professionals we can share with you.
Disclaimer: This information should not be considered legal or financial advice. You should consult with an Attorney or financial professional to determine what may be best for your individual situation.
Author: Sandra Nesbitt