First, we’re so sorry for your loss. This can be a very challenging time for many reasons, and dealing with property ownership is tough at the best of times. What we find so often is that the people we work with already had some “life stuff” going on and suddenly there is this who new, massive layer added on top. Yikes!
You’re thinking, “I inherited a house, no what to do with the thing?” Should I rent it? Should I sell it? It’s full of all this stuff, how do I deal with it. And then there might be taxes, liens and almost certainly repairs. And I’m out of state. Did I hit at least one nail on the head? Two?
Truth is, you are not alone and it’s a scenario we have gone through many times when we talk to folks who have inherited homes in KIlleen. I’m happy to personally walk you through some options but in the meantime here are a few things to get you started.
I Inherited A House, What To Do Next?
Here’s a few important considerations to help you make the right decision:
1) Make sure the mortgage and taxes are paid.
This may sound obvious, but if the person who left you a property may have also had a mortgage (unless it had no mortgage and was paid off, which is great!), and you have to pay it… assuming you want to keep or sell the property. Some banks will allow you to assume the loan, while others may force you to refinance into a new loan. If you don’t qualify for a new loan, renting may not be an option for you. I would recommend figuring out some of this quickly as it is pretty common for the loan to be significantly past due and maybe even close to foreclosure. And some banks will accelerate if once they realize a borrower has passed.
I know this can be the most frustrating part of this but personally, I urge you to persevere. Even if we can’t buy your house, you shouldn’t let a loved ones equity be lost to the bank and I’m happy to help support you in making this happen, just reach out!
2) Be aware of all the costs
It’s rare to see a building that’s been perfectly maintained and most inherited houses need major improvements, particularly if the owner was older. Here is the deal. A vacant house costs money every day. Taxes mortgage and insurance are the obvious ones but the truth is a vacant house deteriorates. It’s like giving up $10 a day. It doesn’t seem like much but it adds up. Here’s a silly but concrete way of looking at it…
A typical cheap roof costs about $7,000. In the Texas heat it last about 15 years. So every day it loses about $1.28 in value if you depreciate it straight to zero. If that roof gets a leak while you aren’t around then you are talking serious loss. In fact, water is the number one value destroyer we see by far!
All that is to say, have a “come to Jesus” with anyone involved, decide what you want to do and execute. Come at it from a position of power and don’t wait until things get too far gone.
4) Selling a property for top dollar costs money.
If you do decide you want to sell the property just remember that a traditional sale typically means getting the property ready to show. There are certainly “as-is” listing options if you don’t mind a lower offer but at a minimum you’ll need to get the property cleared out and cleaned up!
If you don’t want to deal with making repairs, updating kitchens, improving landscaping and overall cleanup, don’t worry. At Liberty Home Buyers, We buy Killeen houses for cash, as-is.
5) If the market will continue to grow faster than your other options, hang on to the investment.
We can help you analyze the value of your property today versus the long-term benefits of renting. If you can use the equity in your property in another way that outpaces the performance of the real estate market, you should. If you don’t have anything better to do with the money and the neighborhood is rising in value, hang on – real estate can be a great investment if you know how to correctly read the market.
6) Compare a few scenarios.
If your just not sure, give me a call. We’ll help you determine prices for any property near Killeen – if you sold it today without doing any work, the highest price the market will bear, and the projected value of keeping it as a rental (along with the costs). We actually love purchasing rentals and have a pretty good idea of what you can and can’t get done in today’s market.