You may consider inherited property as an opportunity, the one good thing to come out of a sad situation. Your new piece of real estate may well be a valuable asset, but there are some things you need to keep in mind when dealing with inherited property. If it’s not a large estate and you decide not to hire a lawyer, there are some important considerations to examine.
Partners
If you have siblings or others that inherited the property equally with you, everyone is likely to have a different idea of what should be done with the property. Even if you are the executor, you still want to make decisions that accommodate everyone as fairly as possible. You will become instant business partners, with the added stress of emotions running high due to the circumstances. One family member (or more) may not be able to make business decisions at this time or may place inordinate value on the property for sentimental reasons. This is especially difficult if one or more partners live a long distance from the property, and you can’t all get together easily. You may need to consider “buying out” partners or finding someone neutral to come in and take over negotiations.
Get Organized
Things happen fast after such an event, and it is important to take care of the business aspects of the property. The first issue is determining if there is a mortgage or any liens on the property that need to be paid. Next, make sure all property taxes are paid and kept current. You will also need to keep insurance on the property until you decide what to do with it. If it’s a home, you’ll need homeowner’s insurance, which is generally more expensive for off site owners. You will have to decide if you want let someone move into the home temporarily and if utilities and such expenses will be paid out of the estate.
Selling the Property
Make sure you get an accurate appraisal of the property and subtract expenses from the potential sales price, so everyone has a clear idea of how much money he or she can expect to collect upon sale. Be sure to include mortgage payments, insurance, taxes, appraisal fees, inspector’s fees, real estate fees, and any other expenses. Discuss the price you hope to list the property for and the bottom line offer you are willing to accept. People often foresee a greater value than what is realistic and it is far too easy for them to end up with hurt feelings or end up feeling cheated when reality doesn’t match their expectations. It helps to detail everything clearly, to help avoid some of these problems, and to hopefully avoid a family rift on top of a loss.