Selling Inherited Property Texas
inheriting a house
Inheriting a property can be both a blessing and a challenge, especially when you’re dealing with the loss of a loved one. While receiving a house as an inheritance can be a valuable gift, it often comes with significant responsibilities. These can include financial burdens, steep repair costs, bad tenants, and ongoing maintenance.
If managing the property feels overwhelming or if the risks seem to outweigh the rewards, selling it might be the best option. If you’re considering selling an inherited home in Texas, it’s essential to have a plan in place for its upkeep and maintenance. Additionally, expert advice can help you navigate the legal and financial complexities involved.
Understanding both the benefits and challenges will help you make an informed decision about the best course of action for your inherited property.
Selling an Inherited House
Factors to Consider
Selling an inherited house isn’t as straightforward as selling a vacant lot or an older home. The process in Texas can be quite complex, and there are several factors you’ll need to consider along the way.
For example, here are some key factors you should examine before deciding to sell an inherited house in Texas.
NOTE: In Texas, an affidavit of heirship can be used to transfer real estate to heirs without going through probate if a person dies without a will!
Property Value
Before seeking an agent, it’s important to research the fair market value of your property. You can do this by comparing it to similar properties in your area or using online estimation tools.
However, it’s crucial to manage your expectations. The estimated value might not reflect the exact amount you’ll receive, as several factors can influence the market value of your inherited property, such as the condition of the house and the current state of the local housing market.
Inheriting a House With a Mortgage
There’s a possibility that the property you inherited still has an outstanding mortgage. To verify this, reach out to the mortgage company that manages the loan.
Once you know the remaining balance, you can start calculating how much you might earn from selling the house. If you find that the mortgage balance is higher than the property’s value, don’t worry—we have strategies in place, such as purchasing the property “subject to” the existing mortgage.
Inheriting a House That Is Paid Off
Inheriting a paid-off house can simplify things, but you’ll still need to transfer the title, update property taxes and insurance, and handle maintenance. You can choose to keep, sell, or rent the property, depending on your needs and preferences.
Outstanding Debts
In addition to checking for an outstanding mortgage, you should also investigate any other debts associated with the property. Are there any unpaid bills? Have all property taxes been settled? Is the property encumbered by any liens, or does it have a clear title?
Answering these questions will help you determine if the sale of the house will only cover the outstanding debts. If this is the case, you might consider postponing the sale until all debts are resolved.
Number of Heirs
Another important factor to consider is the number of family members inheriting the house. All inheritors must agree to sell the property.
It’s also crucial to determine who will oversee the sales process and handle other important tasks, such as clearing out the belongings inside the house. Clear roles and responsibilities can help ensure that the process runs smoothly and efficiently.
Status of Home Transfer
To sell an inherited house in Texas, it must be officially transferred into your name. There are several ways to legally own inherited property:
Probate: If the property was part of an estate with a Will, it must go through probate to transfer ownership to the heirs.
Affidavit of Heirship: When there is no Will, this affidavit can establish ownership by proving the relationship of the heirs.
Property Deed: A standard property deed may be used to transfer ownership if the property is already in the heir’s name.
Living Trust: If the property was placed in a living trust, it transfers directly to the beneficiaries named in the trust without going through probate.
Transfer on Death Deed (TODD): This deed allows the property to transfer directly to designated beneficiaries upon the owner’s death, bypassing probate.
Understanding these methods will help you determine the best approach for transferring and selling the property.
Tax Considerations and Capital Gains
Inheriting a house can have significant financial implications. You and your family might face inheritance taxes immediately upon becoming the owner, or you could incur capital gains taxes when you sell the property.
Tax laws vary by state, but generally, you won’t qualify for home sale tax exclusion if you haven’t lived in the property for at least two years within the last five years.
If you decide not to sell the property immediately, you’ll need to pay taxes on any increase in its value over time.
To fully understand your specific tax implications, including capital gains tax, federal estate tax, and property taxes, it’s advisable to consult a lawyer or accountant in Texas. Given the complexities of tax laws, professional guidance is essential.
One certainty is that taxes on the sale cannot be avoided.
NOTE: We have purchased many houses in Texas without going through probate by utilizing an affidavit of heirship when a person dies without a will.
How to Sell Your Inherited House in Texas:
A Few Methods
1. Real Estate Agent
Working with a real estate agent can help you navigate the sale of your inherited property. They can provide expertise in pricing, marketing, and negotiating to ensure a smooth transaction.
2. For Sale by Owner
Selling the property “For Sale by Owner” means you handle the sale process yourself, without a real estate agent. This approach can save on commission fees but requires you to manage pricing, marketing, and negotiations independently.
3. Real Estate Investor
Selling to a real estate investor can be a quick and straightforward option. Investors typically buy properties in “as-is” condition and often offer cash purchases or other creative financing options. This approach can expedite the sale process and eliminate the need for repairs or renovations.
In today’s market, the average cost to sell a house utilizing traditional methods range from 10% to 12%. That means if you have a house selling at $300K, you’ll have to pay anywhere from $30k to $36k just to sell your home. Additionally, if you have a mortgage on the property, you’ll incur monthly holding costs until it’s sold. You can avoid all these fees selling your house to us!
- We Buy As-Is: When you sell to us, you dont have to worry about the deal falling through because any repairs. that may be needed.
- No Need to stage: Staging cost money and takes time, just to impress traditional home buyers who probably are not going to buy your house at asking price anyway.
- No Need To Clean: When You sell to us, you dont have to waste your days cleaning before showings, or when you move out
- We Can Close Fast: In most situations, we can close as fast as 7 days or date of your choice.
- We Pay All Closing Cost and Fees: Selling the traditional route in todays market will have you paying anywhere from 2%-6% in closing cost and fees.
- No Realtor Commision: When you sell to us, you avoid paying 6% commission to a realtor.
selling inherIted property
Frequently Asked Questions
NOTE: When selling your inherited house to a Cash Buyer, be sure to work with a buyer who is experienced in knowing how to structure these transactions!
should i sell my inherited house?
Whether or not selling your inherited house is the right choice largely depends on your individual circumstances and your familiarity with the concept.
Consider the following questions to help determine if this approach aligns with your needs and situation. It’s essential to take some time to reflect on these questions and answer them truthfully to make an informed and logical decision.
- ARE YOU CURRANTLY FALLING BEHIND ON THE MORTGAGE?
- ARE YOU IN THE PROCESS OF A FORECLOSURE?
- DO YOU OWE MORE ON YOUR HOUSE THAN WHAT IT’S CURRENTLY WORTH?
- DO YOU NEED TO RELOCATE FOR WORK, MILITARY, ECT.?
- ARE YOU CURRENTLY GOING THROUGH OR HAVE GONE THROUGH A DIVORCE?
- DID YOU RECENTLY LOSE A JOB?
- WHAT WOULD HAPPEN IF YOU WERE NOT ABLE TO SELL YOUR HOUSE?
- IS THIS HOUSE OR PROPERTY A FINANCIAL BURDEN TO YOU AND YOUR FAMILY?
- DO YOU HAVE LOW EQUITY, ZERO EQUITY, OR NEGITIVE EQUITY?
If you find yourself relating to one or more of these questions, selling your inherited house might be a favorable option for achieving a quick sale.
NOTE: Did you know the avarage cost for selling a house at $450k with zero equity is about $45-$50k in todays market. Selling your house to us can save you from having to pay someone to sell, and buy your house!
Selling an inherited house
Selling an inherited house can feel overwhelming, especially with all the steps involved before the actual sale in Texas.
If you need to sell or require assistance with selling inherited property, connect with us at Flippin’ Keys! We understand the process and can make selling your inherited house a smooth experience. If we don’t buy your house ourselves, we’ll match you with a local cash buyer in the area where your property is located. Call us at (210) 964-8523 for a quick cash offer, or fill out the form below to get started!