After a loved one dies, while you try to mourn their loss, you may also have to deal with going through their assets in the form of a will or a trust. Within these documents, your loved one may have given you a home that they owned while they were alive. But because you may already have your own home, figuring out what to do with this inherited house can be a challenge.
To help you know what your options are for this, here are three things to do when you inherit a house.
Make An Immediate Plan For Maintaining The Home
While you might be wanting to figure out exactly what you’re wanting to do with the house immediately, what you should really be focusing your attention on is how you’ll maintain the home until you figure out what to do with it.
As part of this plan, you’ll need to get to know the financial situation of the house and what, if anything, is still owed on it. Then, you’ll need to speak with the lender to put in place whatever payments need to continue being made. Additionally, if other people are living in the home, like renters or other family members, you’ll also want to discuss with them what their plans are and let them know if things might be changing with the home in the near future.
Consider The Tax Implications
As you try to figure out what you want to do with the house you’ve inherited, you may want to consider what the tax implications could be for you.
Depending on where you live and where the house is, the laws for taxes will vary. But as a general rule, you may be looking at paying estate tax or capital gains tax. Along with this, if you hold onto the house, you’ll also be on the hook for the property taxes of the home.
Decide What To Do Long-Term
Once you have figured out what needs to be done with the house immediately and what the tax and financial obligations are, you can then start to determine what you might want to do with the property in the long-term.
If the house is in a great location, you may want to move into it yourself. But if there’s no interest in this, selling the home might be ideal. You could also turn it into a rental property that continues to make you money each month. Whatever you decide to do, make sure you weigh all your options and the pros and cons for each choice before you make your ultimate decision.
If you’ve just inherited a home from a loved one, consider using the tips mentioned above to help you figure out what your next step will be.