Conrad Ross - THE PROCESS OF SELLING INHERITED HOMES

THE PROCESS OF SELLING INHERITED HOMES

Conrad Ross

Table Of Contents

Dealing With Inherited Homes: Best Practices For Families 1

Concepts To Know When Selling An Inherited Home

Distribution Among Family Members

Downsides To Inheriting

How Selling A House In An Estate Differs From Regular Home Sales

Determining The Value Of An Inherited Home 35

Four Ways To Sell Your Inherited House

Inherited Home Sales & Taxes

Prepping An Older Home For Sale

10. Small Improvements Can Gain You Thousands 69

11. Marketing An Inherited Home

12. Using Curb Appeal To Sell Your Inherited Home For More 79

13. The Importance Of Good Pictures

14. The Process Of Selling Inherited Homes

About Conrad Conrad was raised in Cincinnati, Ohio with 3 siblings. As a child, Conrad had aspirations of being a chef. His father was an insurance agent and realtor. Conrad was being taught about real estate and flipping houses before age 10. Never in a million years did he think he’d stumble into the real estate industry, but you can’t always predict where or when you’ll discover what you’re meant to do in life. Conrad was taught at a young age that if you want something in life, you have to work for it. So that’s what he did. And he worked hard. As the years went by, Conrad worked his way from construction to Marine, truck driver, chef, to funeral director, never wavering in his resolve to become the best version of himself with each career move. Conrad got into the real estate industry 3 years ago when his wife Amy was already successful in real estate and needed more hands for her growing business. This is how the Conrad Ross Home Team was founded. We have different skillsets that compliment each other, allowing us to serve our clients better. Amy focused on the luxury markets and divorce listings as Conrad focused on niche markets like farm and ranch, military relocation and probate real estate. Throughout his career, Conrad has earned numerous accolades, including: • CPRES - Certified Probate Real Estate Specialist • MRP - Military Relocation Professional • Affiliate Realtor for Homes For Heroes • Over 25 years of contract negotiation, logistics and v

customer service experience

Conrad lives in Azle, Texas with his wife Amy and dogs Roxy and Rebel. In his free time, he enjoys cooking, gardening, working out reading and traveling. Conrad aims to provide the highest level of service to his clients and takes deep pride in helping them achieve their real estate goals.

Foreword

When I first ventured into the real estate industry 3 years ago, I did so with the hopes of helping sellers like you avoid the headaches often associated with the home-selling process. In my years of experience, not only have I helped alleviate the stress of selling for numerous clients, but I’ve also accumulated years of knowledge to help them get more money for their homes in the least amount of time. I decided to share all of my expertise in one place with potential clients. And that’s why you’re receiving this book. I want to help you have the best possible home-selling experience. And by that, I mean I want you to 1. Get the most money possible for your home, 2. Sell in the least amount of time, and 3. Avoid the headaches most commonly associated with the home-selling process. Think of this book as my gift to you. It contains insider advice on the home-selling process to help you achieve your ultimate real estate goals, including: • Secret strategies to sell your home for more money • Marketing techniques employed by top agents • Advice on how to appeal to today’s buyers • And much, much more If, after reading through it, you want to hire me to help you sell your home, I’d be more than happy to meet with you to discuss a specific plan to sell your home. Happy reading!

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Testimonials & Reviews for Conrad Here’s a list of people whom I have helped buy or sell a home, and what they said about working with me: Conrad had a tough job, but he did it! We were tough clients! We were moving to DFW and didn’t have a lot of time to look at houses, having to deal with our employer’s relocation, and all of the other challenges that came along. But, Conrad went above and beyond to help us. Even now, one year after the sale closed, I can still call him for business and service recommendations in the area — he knows just about everyone, and is very happy to help. Conrad is the best agent in Fort Worth! I’ve used Conrad twice so far, and I was impressed both times. I bought my dream home with Conrad last year, he worked long and hard to find me the perfect home. And just recently sold another investment property of mine. Everything went quickly and smoothly. Both of my real estate deals were done very quickly and professionally. Conrad is honestly the BEST, I would highly recommend him. My experience with Conrad during the entire home-buying process, from start to finish, has been nothing short of exceptional. I have a unique work structure, and because of this, it was very difficult to find mortgage lenders that would approve me for a home. I was very frustrated and on the verge of giving up, but Conrad insisted that we continue searching. Not only did we find a mortgage lender but also a mortgage that I felt great about. His perseverance is the reason I am now a homeowner. He is professional, punctual, knowledgeable, and very easy to work with. With the highest regard, I will recommend Conrad to all my friends and family. ix

Conrad helped me find a house by literally picking it out for me. Every house I wanted to go to, I got there and didn’t love it. Conrad was busy taking note of the likes and dislikes I was stating and said “I have a house that you’re going to love”.... AND I DID! I went back 4 or 5 times to show other members of my family, and he accommodated me without complaint. I was a first-time homebuyer, and he walked me through the steps of everything, gave me advice, and constantly followed up to make sure I was doing OK. With his help, I was able to close on the house early, right before I started my new job. I would recommend Conrad to EVERYONE, buying or selling. Conrad made it so so easy. He guided us through the entire process. His recommended great people to work with every step of the way. Conrad was available 24/7 to answer any questions we may have had. With his high standards, expertise in the industry, and patience, we would recommend him as a Realtor to anyone looking! Conrad even advised me on how to prepare my house. Conrad was a gem. In addition to being highly knowledgeable about the real estate market, with many years of experience, he is a consummate professional. Conrad was extremely easy to work with, gave me very good advice about preparing my house for sale and was very responsive during the entire process of receiving offers, selling and closing. I would work with him again in a heartbeat. He's that good. Conrad is the first agent I would call. Conrad and his team were able to rapidly list, show and sell my property. Being an expert in real estate, he was spot on in his pricing of my property and getting this deal completed. Overall, I highly recommend his team. If I want to buy real estate, Conrad would be the first person I’d call.

Conrad was the consummate professional during our stressful and difficult process. In the midst of juggling a ‘failed’ marketing effort with another agent, he presented a well thought out plan and strategy to sell our home in short order. We needed to move quickly due to a growing family and another baby on the way. He helped alleviate that pressure by securing an acceptable offer with 3 days of listing. We put pressure on him, and hedelivered.

Conrad kept us calm throughout the process!

Conrad always made himself available to answer questions. He worked hard to sell our home and find the best fit for our new home. He and his team worked with us through the entire process and kept us calm when we got anxious. I am 100 percent satisfied!! Conrad found us our dream home. He was very efficient and helped us find our dream home within a few short months. He was able to negotiate the price that we wanted for the house. Overall, I would look for him again to help us look for a house if need be in the future. Thank you so much! Efficient communication and service. Conrad and his staff were very helpful in selling our condo. They kept me informed frequently with email, sending reports on showings, offers, and feedback from potential buyers. We are very satisfied. I used the Conrad Ross Home Team in June of 2019. I had used a few local agencies in my home town but was never pleased with how I was dealt with. Other companies seemed to think they knew what was best for me...wrong! I ended up meeting Conrad and Amy Ross and just fell in love with them. It took only showing me one house and they are my real estate agents for life. The one house I was shown by them ended up being the house I purchased. I would highly recommend Conrad and Amy to anyone. They make the process so easy and make it about

their clients. Not only are they my agents for life, but we have a friendship for life as well. Excellent experience topped with a personal touch. Excellent experience all around, not only knowledgeable but Conrad and The Conrad Ross Home Team have a very personal touch I felt like family throughout the entire process. They always took their time; we never felt rushed or like “just a number.” I sold my home and bought with him. We had lots of questions, he gladly answered them with no problem and guided us through the entire process, eliminating lots of stress. I truly appreciate that and would recommend Conrad and his team to family and friends. Sold our home in a week! Conrad was an absolute dream to work with. Professional, responsive, efficient, and my moral support when in time of need...unfortunately for him. We sold the home within a week. What else can you ask for? Grateful, grateful, grateful!!! You went above and beyond for our family. You both made a super stressful in our lives not as stressful! Thank you so much! I would recommend everyone to you! The Ross team is always great with answering any questions I have going towards home ownership. Thank you for your exceptional customer service and dedication towards home ownership! I highly recommend!

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Resources The process of selling a home can be stressful, even if you’re working with a professional real estate agent, like myself. Chances are, you’ll have to hire various professionals throughout the process, either to prepare your home for sale, or to fix any of the numerous issues that can pop up in a home inspection. The last thing you want to do is hire an unreliable contractor who delays — or even ruins — your home sale. I’ve experienced firsthand the work of numerous local contractors and professionals. I know which companies will produce the highest-quality work, and which ones to avoid. Because I want my clients to have the most stress-free and successful real estate experiences possible, I recommend only the best professionals in a variety of specialties — from home inspectors, general contractors, home stagers and cleaners, lawyers, title companies and lenders. I have personally worked with each contractor endorsed in this book, and each one comes with my highest recommendation. You can confidently hire any one of these companies or individuals, knowing you’ll be in great hands. In this section, I’ve provided you with a list of resources, along with a brief explanation of how each one can help you have the ultimate home-selling experience.

Have You Gone “Nose Blind?”

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“What is that smell?”

Is that the first thing you want buyers to say when they walk through the door to your beautiful home? Despite how much you may vacuum — and even scrub — your carpets, there’s a chance you may have gone “nose blind” — to quote Febreze — to all the odors they contain. But that doesn’t mean you need to spend hundreds, or even thousands, tearing up and replacing your carpets. A deep carpet cleaning can restore even the oldest, dingiest carpets. Sure, you can rent a unit from a local hardware store to clean them yourself, but if you really want to eliminate troublesome odors and remove any deep, set-in stains, you really should turn to a professional. Mars Services has been helping my clients make a great first impression for years. They are my go-to contractor for many things beside carpets. Mars does just about everything from house cleaning to roofing, electric, plumbing and HVAC. I'm probably missing something. They use the best in carpet-cleaning technology to restore your carpets and stomp out any odors you may not even realize you have. You’ll be breathing easy — and so will your buyers — knowing your carpets are in tip-top shape!

Mars Services 817-386-4084 info@marsservices.com

Clean is Always in Style

You may think that to sell your home, you need to do major xiv

kitchen renovations, install hardwood floors, and knock down a bunch of walls. And while those changes aren’t necessarily a bad idea if you want to sell for top dollar, they’re not always worth the return on investment.

But do you know what is? Cleaning .

Cleaning and organizing your home before a sale is the easiest way to ensure it sells quickly — and for the most money possible.

So what should you do to get your home in tip-top shape?

• Deep clean every surface — floors, walls, carpets, countertops, cabinets, appliances, toilets, tubs, etc. • Organize and remove clutter. • Consider investing in a storage unit to store knick knacks, toys, tools, old furniture, unused small kitchen appliances, and piles of paperwork. If this sounds like a lot of work, that’s because it can be. You’re much better off leaving these tasks to professionals. You wouldn't go on a date in dirty clothes, and you shouldn't show your home when it’s not looking its best. I recommend the following professionals to take the handle the stress of deep cleaning and organizing your home.

CJ's Home Cleaning Service 817-805-6674 cjshomecleaning@gmail.com

The professionals at CJ's Home Cleaning Services are fully vetted

and will make every surface of your home look like new. They are efficient and affordable and can deep clean any area of your home you may have neglected over the years.

The Clutter Commander 817-992-5051 tamara@cluttercommander.com

You may not realize it, but there are professionals whose entire job is to declutter and organize spaces. Whether you need someone to organize your closet space or simply help you get rid of items around the house you no longer use, The Clutter Commander is the best company for the job.

Cube Smart Self Storage 844-427-1409

If you need to rent a storage unit, look no further than Cube Smart. Their units are clean, secure, and come in a variety of sizing options. Your items will stay safe while they wait to move to their new home! Why Curb Appeal Matters They say you can’t judge a book by its cover — but it’s also true that books with worn out or torn covers tend to stay on the shelf. When you’re trying to sell your home, you know you have to prep and clean the inside to get it ready to show. But did you consider how your home might look from the outside? When potential buyers pull up to your property — or even when they’re checking out photos online — the exterior is the first thing they see. If your landscaping is in disarray, or your exterior xvi

paint is peeling, buyers may not even venture inside.

So what should you do to get the outside of your home buyer- ready? The National Association of Realtors® offers the following tips to enhance your curb appeal:

• Clean exterior walls and windows • Apply a fresh coat of exterior paint • Keep grass green and trimmed • Clean and repair your roof

Luckily for you, I have worked with lots of reliable contractors who are experts in creating curb appeal. These professionals can help you increase the value of your home and sell for top dollar, fast!

Texas Turfmasters 817-861-8873 adam@texasturfmasters.net

I recommend Texas Turfmasters to take your property to the next level. Whether your yard needs a full overhaul or just some fresh mulch and shrubbery, Texas Turfmasters can meet your needs.

J3 Painting and Drywall 817-663-3870 jtoy003@gmail.com

A fresh coat of paint can transform your home from dull and dingy to bright and welcoming. J3 Painting and Drywall uses only the highest-quality products to transform your home to its most pristine state.

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Lon Smith Roofing 817-235-5094 -Tony Endsley 800-317-4791 info@lonsmith.com

Whether your roof needs to be completely redone or you just need to replace a few shingles, Lon Smith Roofing is the best local professional to handle your roofing project. Dozens of former clients have put their trust in Lon Smith Roofing, and I’m confident you’ll be pleased with their work.

Electrical Issues Can Ruin Deals

Electrical issues are some of the most costly — and potentially dangerous — issues uncovered in any home inspection. In fact, the American Society of Home Inspectors counts electrical issues as one of the top deal-killers in the home-buying process. Some of the most frequent electrical issues found include:

• Undergrounded three-prong plugs • Painted outlets • Double tapping of circuit breakers • Reversed polarity • Improperly modified electrical panels • Knob and tube wiring • Aluminum wiring • Federal Pacific breaker panels • No GFCI protection

Unless the extent of your electrical issues is a burned-out

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lightbulb, all electrical work should be handled by a licensed professional. Besides being too complicated for most homeowners to handle, electrical repairs pose a huge risk of electrocution and fire. I’ve recommended Drake Electric to many of my clients in the past. Not only are they affordable, but they perform top-quality work, ranging from fixing faulty outlets to completely rewiring older homes.

There’s no one I trust more to work with my clients.

Drake Electric 817-825-5200 greg@drakeelectricalservices.com

Are Your Floors Buyer-Approved? If you’ve watched any HGTV show in the last several years, you know one of the first things home buyers are likely to notice is the type of flooring running through the house. If your flooring is dirty, chipped, worn, outdated — or an unappealing color — chances are, buyers will take notice — and move on to the next house. When buyers see bad floors, they immediately see dollar signs. And no one wants to see extra dollar signs before they even purchase a home.

So what kind of flooring should you get?

Based on data from the National Association of Realtors®, 54% xix

of home buyers were willing to pay more for wood floors. But if you can’t afford wood floors, there are many options for wood- look tiles, vinyls and laminates — some even waterproof — that will more than satisfy picky buyers. Munoz Flooring and More LLC can help you with all of your flooring needs, from material selection to quick and professional-quality installation. Call them for an in-home consultation today!

Munoz Flooring and More LLC 469-597-7040 munozflooringandmorellc@outlook.com

Your Front Door: The Ultimate First Impression

Your front door is the gateway to your home.

A freshly stained or painted door, with shiny new hardware and clean glass, says “Welcome home!” to buyers who come to see your house. A front door with peeling paint, rusted hardware and fingerprinted glass might just leave them out in the cold. First impressions matter, and your front door is the ultimate first impression. Stand outside your house, and if you’re less than satisfied with how your front door looks, change it up! Consider a fresh coat of paint or stain — one of the newest trends in real estate is to make your front door pop with a bold,

contrasting color — replace old hardware, and clean any glass surfaces on the door. With something as important as your front door, you may want to put your DIY skills on hold. A professional painter has access to the most durable, weather- resistant materials and will create a pristine finish. I always recommend K&H Painting and Construction LLC to my clients. Their painters are professional and highly skilled. You won’t have to worry about patchy work or unsightly drips. While you’re having your front door painted, walk through your house and consider the impression your paint colors might have. That bright orange you painted your living room in the early 2000s might have seemed like a cool, bold move back then, but it’s likely to turn off buyers who view your home now. K&H Painting and Construction LLC would be more than happy to take care of all your painting needs!

K&H Painting and Construction LLC 940-923-2717 brian.carson@kandhpainting.com

Get a Handyman on Your Side

When you finally accept an offer on your home, you may think the hard work is over.

But unfortunately, that’s not always the case.

Once your buyers order an inspection of your home, chances are, they’re going to come back with a list of demands — or ask for a price reduction based on the list of repairs the inspector xxi

says they need.

But rather than dropping your price, you can turn to a great handyman to make any last-minute repairs and salvage your deal. When it comes to hiring a reliable handyman, you can’t trust just anyone. As a real estate agent, I’ve worked with dozens of local contractors, and I know exactly who you should call. For repair jobs big and small, I always recommend Richie Fenn. Whether you’re looking at a simple repair like a broken door knob — or a major fix like a broken staircase — you can trust Richie Fenn to get the job done to your highest satisfaction — and please even the most demanding buyers.

Richie Fenn 817-495-8897 richiefenn98@gmail.com

Read This Before You Sign a Contract With a Buyer

Imagine taking your home off the market for 60 days while a prospective buyer tries to buy it. Then, 60 days later, the buyer finds out they can’t get a loan. You just wasted 60 days of marketing time! Now, imagine that during the 60 days, another buyer wanted to buy your home. But the buyer couldn’t purchase it. Why? Because you signed a contract with the first buyer. By the time you find out the first buyer could not obtain financing, the other buyer has already bought a house! Ouch!

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You just lost a sale! This is why it’s so important to make sure a buyer is able to obtain financing before you sign a contract. Fortunately, I work with a mortgage lender who can pre-qualify any prospective buyers. Service First Mortgage will tell you whether they’ll be able to obtain financing. It costs you nothing to have Servie First Mortgage prequalify your buyers. Their lenders can help buyers get a loan with the most competitive interest rates available. You can rest easy, knowing they’ll be able to obtain financing. This is a free service. Buyers are under no obligation to use Service First Mortgage to get a loan. They’ll help buyers get the best loan for their financial needs: • Conventional—A conventional mortgage can lead to a low fixed rate or adjustable rate for your primary home, secondary home, or investment property. • FHA—An FHA mortgage is a great program for buyers. Its advantages are a low down payment without private mortgage insurance. The lender process can be streamlined, with no appraisal and reduced loan documentation to qualified applicants. • VA—A VA Mortgage offers many benefits, including no down payment and lower interest rates. • USDA—These are only available in certain areas deemed “rural” by the United States Department of Agriculture. Surprisingly, many properties on the outskirts of a metro area will qualify for these loan programs. The advantages of a USDA Mortgage are lower interest rates and zero down payment.

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Because Service First Mortgage is familiar with all of these loan programs, they can pre-qualify your buyers and ensure they obtain financing. That way, you avoid wasting time with buyers that will not qualify for financing. Before you sign a contract with a buyer, make sure you give them a call.

Service First Mortgage bdement@sfmc.com 817-707-3990

Is Your Faucet Leaking?

No one wants to find themselves knee-deep in plumbing issues — both literally and figuratively. And even worse, no seller wants a home inspector to discover those issues when they’re just about to reach the finish line of a great deal. That’s why I always recommend my clients have their plumbing inspected by a professional before they put their homes up for sale. Double L Plumbing gives my clients peace of mind in the home- selling process. My sellers know going into the inspection process that everything will check out and won’t delay — or even destroy — their sale. Whether you have a leaky faucet or some strange hissing noise you just can’t place, put your trust in Double L Plumbing to get to the root of the issue and fix it for good!

Double L Plumbing 817-444-3100 - Azle 817-550-6271- Weatherford

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Pool Worries, Be Gone!

If you own a pool, you know how much work can go into maintaining it. That stress doubles when you’re preparing to sell your home and want your pool to look like the relaxing oasis buyers imagine it to be. Having a pool can be a major selling feature for the right buyer. But buyers looking for a pool don’t want to see your pool and immediately think, “This is going to be a lot of work.”

Before you sell your home, you should consider the following:

• Is your pool clean? If it’s an above-ground pool, are the parts rusting and liner showing signs of wear and tear? If it’s an in-ground pool, are the cement, tile and grout spotless? • Are there any broken parts or leaks? Does it have broken tiles or cracked cement? • Is it fenced in? You may run into zoning code issues if you don’t have a proper fence installed. • Is it low on water? If buyers don’t notice these issues themselves, a home inspector will be sure to point them out. You’re better off handling any potential issues before you put your home for sale, rather than scrambling to fix them later on. Pool maintenance can be stressful — and costly — if you don’t know what you’re doing. This is one job you’re better off leaving

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to a professional. For all of your pool maintenance needs, I recommend Kustom Pro Pools. They’ll turn your pool into the dream space every buyer wants to see.

Kustom Pro Pools 940-273-6728 kustompropools@gmail.com

The Roof Over Your Head The old saying goes, “As long as you have a roof over your head, clothes on your back, food on the table, and good friends and family, you have all you need to live a happy life.” But if your roof is leaky, old, or missing a few shingles, buyers won’t be happy making an offer on your home. Roof issues can be a major sticking point for buyers — and will 100% turn up in a home inspection. Likewise, many home buyer programs won’t finance homes with old or broken roofs. If you want to save yourself the hassle of scrambling to make repairs at the last minute, I recommend having your roof checked out by a licensed professional before you put your home up for sale. Whether your roof needs to be completely redone or you just need to replace a few shingles, Select Construction is the best local professional to handle your roofing project. Dozens of former clients have put their trust in Select Construction, and I’m confident you’ll be pleased with their work.

Select Construction 817-386-5361 info@selectconstructionllc.net

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The Secret to Selling for Top Dollar According to the National Association of Realtors® 2017 Profile of Home Staging, about one-third of buyer’s agents said that staging a home increased the dollar value their clients offered between 1 and 5% compared to other similar homes on the market that were not staged.

So what exactly is staging?

Home staging is the act of preparing a home for sale by arranging furniture and decor that allows potential buyers to picture themselves living in the home. The goal of staging is to make a home appealing to the highest number of potential buyers, causing it to sell more quickly and at a higher price point. As a real estate agent, I have a pretty good understanding of staging concepts. But I really prefer to recommend a professional to give my clients the best chance of selling their homes for top dollar in the least time possible. Eden Beaupain has transformed spaces inside my clients’ homes. They offer connections to furniture rental companies and years of experience in the art of home staging.

Eden Beaupain 817-944-2541 edenware@live.com

Ensure Your Closing is Smooth and Easy

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Here is everything Capital Title can do to ensure you have a stress-free, smooth, and easy real estate closing:

• Solid Communication. They keep you updated on what’s happening at all times and respond to your inquiries in a timely manner. • No surprises. They work hard to get everything lined up properly early on in the transaction, so there are no surprises later. • Convenient closings. They work hard to close at a time that is convenient to your schedule. If you can’t make it to the closing, they’ll handle it with a convenient “mail- away” closing. • Competitive Rates. They work hard to offer their services at a competitive, affordable price. • Knowledgeable. They understand that real estate is a complicated industry. If you have any questions throughout the process, they’ll answer them for you. Here’s the first step to get started on your stress-free, no-hassle closing.

Find Out Exactly How Much Money You’ll Receive on Your Sale.

Capital Title will put together a free, no-obligation closing cost estimate to show how much money you’ll receive from your home sale. The free estimate will itemize all of your projected closings costs and fees. To request a copy of this free estimate, call their office at 972-682-2700.

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Want Top Dollar For Your Home? There are many different things you can do to sell your home for top dollar. If you use these strategies, you get a higher sales price. But, miss any of these crucial components, and you risk settling for a lower price than you deserve. That’s why I offer a Free “Sell For Top Dollar” Consultation. I’ll meet with you, take a look at your home, and show you exactly what needs to be done to sell for top dollar. I’ll give you advice on marketing, pictures, pricing strategy, staging, negotiations, etc. Each of these items is crucial to your sale. Get them all right, and you’ll sell for top dollar. But, neglect one of them, and you risk settling for less than you deserve. So, if you’d like my Free, No Obligation, “Sell for Top Dollar” Consultation, give me a call at 682-554-7586. We’ll schedule a time that works for the both of us to meet. I look forward to helping you!

Best Regards,

Conrad Ross The Property Shop Conrad Ross Home Team conradsoldyourhome@gmail.com 682-554-7586

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CHAPTER 1 Dealing with Inherited Homes: Best Practices for Families Dealing with an inherited home is a complex subject, and there are several complicated issues to resolve. A web search for “selling inherited property” returns more than 10 million results. A glance down the first page or two shows some of the issues: • Do You Pay Capital Gains Taxes on Property You Inherit? • What Taxes Are on an Inherited House? • If You Inherit a Home Do You Qualify for the $250,000 Home Sale Tax Exclusion? • What to Do When You Inherit Your Parent’s House, Home Inheritance Issues, and on and on. Additionally, it is not uncommon for a person selling an inherited home to have a sentimental attachment to the property, with the sale being the result of a recent death in the immediate family. This adds an emotionally overwhelming component to the transaction. Because of continuing property ownership obligations such as property taxes, insurance, utility bills, household and grounds maintenance—in addition to any issues with the settlement of the estate—a rapid sale is often necessary. Getting a loved one’s house ready for the market can be anxiety-provoking, emotional, and stressful. It likely includes clearing out once-treasured belongings and depersonalizing the rooms.

Then there is the financial cost of making necessary updates to attract buyers. Sometimes heirs must deal with liens or hidden problems in the house structure or systems (i.e., electric, plumbing, and gutters), and there may be disagreements among beneficiaries about the sale price, or whether to sell at all. Family members drag their feet, distracted by images of growing up in the home, preventing them from taking appropriate action. They can’t let go. Everyone takes the time they need to deal with the passing of a loved one. Sellers in this situation need to take the appropriate steps to learn the market, educate themselves, and have a reliable real estate agent and tax attorney or Certified Public Accountant (CPA), an empathetic party who is there to help. This little book is meant to offer some proven tips that can help owners of inherited property approach the issue in a structured manner, with fewer problems and more satisfactory results for all stakeholders concerned. Here, we will discuss the different aspects of splitting the property with family members and the best practices involved.

BENEFITS OF SELLING

No matter if you are a single heir or one of multiple heirs to the property, selling it as quickly as possible will save money, time, stress, and the tiring effort involved in the settlement process. There are several benefits to selling the inherited property. For example, in some cases, along with inheriting property, the heirs end up inheriting unexpected commitments and difficulties with legal and financial implications. Every situation when someone inherits and then sells a home is typically different from each other.

For example, if it is discovered there are environmental concerns

or the mortgage is “underwater” (meaning the mortgage balance is more than the home is worth), heirs may even choose not to accept the home at all, allowing it to go into foreclosure. Those who do not want inherited property should consult a lawyer promptly, as disclaimer paperwork will likely have to be filed. Traditional home sales methods are a perfectly good option if you find that there are no outstanding mortgages and the property is in good shape and does not require major repairs or cleaning to sell. If you can easily afford any necessary repairs and cleaning while handling the selling process, then you can safely choose to sell an inherited property just as you would any other house. This is not to say that selling the property will always be complication-free, but even when issues arise, it may still be worth it to persist with the sale. When there are siblings or family members who share the property with you as legal heirs, there might be disagreement about how the settlement should proceed. Therefore, selling the property could save you the aggravation of dividing a singular property between many hands. Once the property is converted to money, the money can be more easily distributed among the heirs. One concern that you do need to address is the amount of time required to sell the property, since it is uncertain when it may sell. A short sale of the home can come to your aid if there are mortgage payments due which you are unwilling or unable to pay. If one or more heirs inheriting the property have an urgent need for cash, then a quick home sale is also a good option. Sometimes, you might receive some added tax benefits from selling the home. At times, you might also feel that you just want to get rid of the burdens an inherited home imposes by selling it quickly so you can get on with your life as smoothly as possible.

If the property is in a different city or state, assuming the

responsibility of maintaining a vacant house can be a burden that you may not be prepared to endure. If the house goes to probate, even if there are no residents, the property must be maintained. The property taxes, insurance premiums, utilities, homeowners association fees, and other ongoing costs must be paid by someone. Depending on how long the probate period lasts, families may need to pay for many months of maintenance, along with the legal fees and other expenses connected to owning and selling the property. At the end of the probate, you will also have to go through the effort and expenditure of repairing and selling the home. Under such conditions, if your benefits are lower than your commitments, it may be wisest to simply sell the home to investors.

DEALING WITH FAMILY MEMBERS

Disputes among siblings or legal heirs over the settlement of inherited property are common. Often, disputes over a property are dominated by past issues of sibling rivalry and are a fight for dominance. In the absence of parental guidance, adult siblings are left to face the scenario of ambiguity or disagreements over their rightful role. It is essential that you work to ensure that disputes and disagreements do not lead to litigation. Litigation will only worsen the situation by causing issues with family members, and creating uncertainty and wasting time waiting for legal issues to be settled, as well as the usual expense and aggravation associated with legal hearings. The tremendous cost involved in litigation is certainly a wasteful expenditure. Litigation is not the peacemaker’s choice—prevent it whenever you possibly can. This situation can be avoided. By keeping the emotional heat down and a compromising frame of mind in the forefront, there

is generally a solution that can be made for a peaceful settlement. Where creative solutions to these problems can be facilitated, there is mutual gain for all concerned. A good solution is for one of the heirs to buy the property from the others. Ordinarily, if you inherit the home with your siblings without any remaining mortgage, the rule is that ownership is to be evenly split unless otherwise stated in the will. If one of the siblings is interested in keeping it while the others want to sell it, the interested sibling can buy out the others using conventional financing. The cost involved in this process can be minimal and includes the appraiser’s fees and the closing costs. If this will work, you pay your siblings in cash for their shares and get the title of the property transferred into your sole name through a deed. Alternatively, a private agreement can prove useful under some circumstances. For instance, if you or your sibling cannot qualify for a mortgage, the one who does not wish to keep the house can finance the transaction. This will mean you will not need a home loan or incur out of pocket expenses. For a private agreement, you make a promissory note to your sibling for his or her share of the value as assessed by the appraisal. The amount due to him or her can be paid in monthly installments along with interest. With this arrangement, you can buy out the property over time. If necessary, you may also make a deed of trust that grants the power to foreclose if you default on payments. Renting the property could be the solution if none of the siblings are interested in keeping the property personally, but as a group the heirs see benefit in the house as rental or investment property. If you have a friendly relationship and can get along for a long period as co-owners of the property, you can rent out the

property and take your share out of the proceeds monthly. If one of the siblings manages the collection of rental payments and arranges maintenance for the property, the effort can be rewarded by the others with an increased share. Whatever the terms are, though, it is advisable to record them in a written agreement to forestall future disagreements and conflict. Sometimes, though, the best arrangement under these circumstances is still to sell the property, subtract the expenses and costs involved, and the commissions paid, and then divide the resulting amount among you. Selling the property as soon as you inherit also helps save on the capital gains tax. Capital gains tax for sale of the inherited property is calculated on the property value after the death of the decedent. Since the difference may not be much if the time between death and sale is short, you may be left with nothing to pay in capital gains tax. A lawsuit for partition should be the last resort for you to settle the inherited property if you cannot come to an amicable agreement with your sibling over the settlement. If it comes down to it, you can file a lawsuit asking the judge to order the sale of the home and terminate your co-ownership. This is a complicated process and the judge usually appoints a mediator first, to get the property ready for sale. If you are at odds with each other, you and your siblings might not be able to do this. Therefore, you will need to have an agent sell the home and mediate between you.

HOLDOVERS LIVING IN ESTATE

When inheriting a property, you might have to address the issue of holdovers living in the estate. If one of your siblings or yourself is living in the property, you need to come to an agreement with all the heirs regarding whether the concerned individual will continue to live there or will need to vacate.

In the case of continuing to live there, the terms must be clearly

drafted. If the right to remain there is mentioned in the will, then it cannot be challenged. If it has to be challenged for some reason, the necessary legal proceedings must be adhered to. If the decision is made to sell the property, then the property must be vacated in a definite timeline facilitating the sale. If the occupant wishes to continue residing in the property despite the sale, then it must be dealt with accordingly. If you are inheriting a property with tenants living in it, you must fulfill some responsibilities from the position of a landlord. If the property is sold, the legal rights of the tenants must be given due consideration. For complicated situations like this, consult an attorney.

SPLITTING UP ITEMS INSIDE

Decisions pertaining to the settlement of the property or the division of its contents among the legal heirs must follow the guidance given in the will. Where there is no will enacted by the owner of the property, then the state’s laws regarding intestate succession will come into play. If either the will or the law requires the estate to be divided equally, the heirs must act accordingly. Sentimental objects are invaluable to those they are valuable to and settling them should happen out of the legal conventions in agreement between the siblings. Since the value of sentimental objects is often subjective and cannot be decided by an appraiser, the real challenge comes when more than one sibling wants the possession. Negotiation and compromise are called for. A real estate agent can be appointed to decide the value of the property. The challenge here may revolve around how to divide the real estate among the heirs in a way that is acceptable to all parties. The two main approaches that the siblings could take include either selling the property to divide the proceeds or

keeping the property and sharing its use. If the estate also features assets that cannot be distributed on pro-rata basis, an equal division of value is the solution. If a sibling wants to hold the property, then the others can get cash equal to their share of the property or other assets as it may be decided. Ultimately, everyone involved in the deal walks away with his or her share of the property in the right proportion. Dealing with the leftover items in the estate could be a laborious task and a bothersome job while attempting to settle a property. In this situation, you might need to categorize the items as those to keep, those to sell, those to donate and those to throw away. Remember that during an estate sale, people may be ready to buy even the oddest things. Therefore, make an effort to see that as many things as possible are sold or auctioned away to be converted into cash and distributed among the heirs.

CHAPTER 2 Concepts to Know When Selling An Inherited Home

There are a few legal concepts and other issues you should make sure you know about when selling an inherited home so that you can make informed decisions and avoid complications.

WILLS

Most houses that are inherited are passed at the owner’s death by the terms of that person’s “will.” A will is a person’s last chance to do whatever they wish with their property. It is a legal document with the authority to dictate the disposition of a person’s property at death and is very difficult to contest, no matter how apparently unreasonable its terms may be. Yes, someone of “testamentary capacity” (sound mind) really can leave a massive fortune to charity or a favored pet, bequeathing nothing to children or other relatives. Where the maker of the will is the sole owner of a home, that person enjoys complete rights to it (subject to liens or mortgages) and can draft the will in favor of legal heirs or anyone else he or she wants to inherit the property. An individual appointed to administrate the estate of a deceased person is the “executor.” The executor’s main duty is to carry out the instructions and wishes of the deceased. The executor is appointed either by the maker of the will or, in cases where there was no prior appointment, by a court. The executor will ensure that the transfer of titles happens as stated in the will.

The existence of a will concerning the estate makes the process of inheritance indisputable and smooth. If there is no will in place, then the established state laws that govern “intestate succession” (death without a will) will dictate the handling of property and, if needed, a court will intervene to settle issues. The word “probate” carries negative connotations with many people such that they work and plan to avoid it. However, probate does not have to be a difficult or drawn-out proceeding. Currently some 35 states allow simplified probate proceedings, called “common” or “informal” probate. The difference between common and “solemn form” probate begins when the executor submits the will to the court. For example, when an executor chooses to pursue common form probate in New Jersey, that executor can file the will at the court clerk’s office and fill out an application for appointment to the executor position. Will witnesses do not have to be present. Where the executor chooses to probate the will by solemn form, a legal complaint must be filed with the probate court, asking the court to open probate proceedings. Solemn form probate involves sending notice of the proceedings and a copy of the will to all the decedent’s heirs, whether mentioned in the will or not, as long as they would have inherited if he had died “intestate” (without a will). Common form probate does not require this step, although heirs can request a copy of the will from the executor. The solemn form probate notice includes a date for a court hearing in some states. All interested parties have the right to attend this hearing, where a judge will admit the will for probate if he or she determines it is valid and meets the legal requirements. With most estates, there is no reason for the executor to go through a solemn form probate if common form probate is an option. An executor generally chooses solemn form probate only

if she believes an heir or beneficiary might contest the will. Solemn form probate restricts heirs and beneficiaries from filing a will contest after a court-ordered date. Often, judges hear potential will challenges during the initial court date, when they decide if a will is valid. The will is either declared invalid, or is declared valid and can proceed through the rest of probate uncontested. In common form probate, heirs generally have years to decide if they want to contest the will, which can leave the estate in legal limbo. Even after the estate settles and closes, there remains the possibility that an heir might file a contest to reopen it again. For example, Georgia allows heirs four years in which to contest a will probated by common form. Beneficiary distributions made through common form probate are not final until the challenge deadline passes (up to four years). This means a beneficiary can receive an inheritance, only to have no choice but to return it to the estate years later if another heir successfully challenges the will. With cash inheritances, the money could easily be long gone by that point. Real estate and tangible assets might fall into disrepair. Executors generally will not risk this and will ask the beneficiary to sign a binding agreement to return the inheritance to the estate if necessary, or request solemn form probate. If the executor mentioned in the will is unable or unwilling to serve, then an appendix will be created to appoint the new executor. However, before the appointment of the administrator, there should be a declination letter from the executor (if he or she is still living and not incapacitated). In this event, the executor can be selected by a majority of the beneficiaries. For the sake of minors or incapacitated heirs, the court appoints a guardian ad litem, which is just a fancy way of saying someone to look out for the interests of the minor

heirs. Probate is not required when there is no property to be divided under the terms of the will and testamentary letters are not necessary to take control of assets in that case. It is essential to file the will of the deceased with the probate court. Unlike bank accounts, real estate properties will not automatically pass on to a surviving co-owner. To transfer the title of an automobile, probate is not needed, but real estate transfers require it. In the absence of a will that names an executor, state law will list people who can legally discharge the responsibility. If there is a necessity for a probate court proceeding, then the court will choose the administrator based on a priority list. The “intestate succession” laws vary between states as to what happens to a deceased person’s property who dies without enacting a valid will. If the deceased person was married, the surviving spouse will get the largest share of the estate. In cases where there were no children, the surviving spouse inherits the entirety of the property. The laws of every state dictate how children and other heirs inherit the property differently, though, and will need to be studied to make sure you fully understand the state laws that will be affecting you and your property.

TAXES

While the authors of a will pass on their property with the best of intentions, inheritors often must spend a great deal of money, effort, and time if they want to keep that property. The tax burdens accompanying inherited property are frequently a matter of concern and confusion. When inheriting a home, you need to know what kinds of taxes are attached to the home and what your obligations are. Note that tax laws significantly differ from state to state, so you should make sure to understand the inheritance tax laws of your state.

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