After a loved one has died, when people find out that they inherited a home, it may seem like a small glimmer of joy during an otherwise difficult time. However, inheriting property comes with complications, and important decisions will need to be made.
You may not feel up to making those decisions right away. However, it's important to at least begin thinking about what you want to do with the property and seek experienced legal, real estate and financial advice. There are a number of options most beneficiaries can consider:
Move into the property. If the home is nearby, or somewhere that you want to live, this might be the best option — particularly if the mortgage is paid off. However, make sure you can afford the property taxes, maintenance, repairs and potential inheritance taxes.
Rent out the property. It may prove a nice source of income if you don't mind being a landlord or hiring a property manager. You may also need to pay for repairs and renovations before renting it, as well as keep up with ongoing maintenance tasks and taxes.
Sell the property. If you don't want to keep it, you may choose to unload it. If so, you can either renovate it and put in on the market for as much money as possible or sell it as-is for a lower price, but with the renovations and repairs left to the buyer. You may also choose to sell all or some of the belongings inside along with the home in an estate sale.
Refuse the inheritance. If none of the above options appeal to you, you can refuse to accept the property. This may be the best option if there is still a mortgage or other debts owed on it that you can't or don't want to cover. If you refuse the property, the executor of the estate will deal with the creditors.
If you're the sole beneficiary, the decision is basically yours alone to make. If you've inherited the home with other beneficiaries, such as siblings, you'll need to decide together what to do.
Whatever the situation, get as much information as possible on the home's value, how much (if anything) is owed, the costs of keeping it and the potential tax impacts. An experienced Maryland estate planning attorney can help you sort through your options and recommend other helpful professionals.
Source: Realtor.com, "So You Inherited Property—Now What?," Lisa Johnson Mandell, accessed Oct. 19, 2017