First, we’re so sorry for your loss. We understand this can be a very challenging time for so many reasons, and dealing with property ownership is tough at the best of times.
You’re probably thinking, “I inherited a house, what to do with this home?” Should I keep it and rent it out? Should I sell it? How would I sell it? Am I going to have to spend money to update it first?
Tons of options open for you, but…
… we can help.
We’re seasoned real estate investors based in Tulsa, and we’re looking to buy several houses each month in Tulsa OK and surrounding areas. Every month we get calls from individuals and families just like you who have inherited a house and don’t know the first place to start…and considering selling the house… so the following info contains some tips to help you navigate the process of dealing with your situation.
Inherited A House, Now What Do I Do Next?
Here’s a few important considerations to help you make the right decision:
1) Make sure the mortgage is paid.
This may seem obvious to most people, but if the person who left you a property also had a mortgage (unless it had no mortgage and was paid off, which is great!), you will have to pay the payments (assuming you want to keep the property). Some banks will just allow you to assume the existing loan, while others may force you to refinance into a new loan in your name and credit. If you don’t qualify for a new loan, renting may not be an option for you.
2) The investment is only as good as the manager.
If dealing with brokers, maintenance, tenants, rent collection and all the nuances of property ownership and management isn’t the best use of your time, you can hire a professional to help you or just cash out now and avoid the stress. Some people who inherit homes decide to keep the house and rent it for extra income. That’s a great strategy for sure. You just need to be prepared to manage the property and the hassles that can go along with tenants calling, paying late, and toilets, air conditioners, or roofs needing repairs.
3) Property ownership costs a lot of money.
It’s rare to see a building that’s been perfectly maintained. Most inherited homes tend to need major improvements, repairs and updated.
Consider hiring a professional property inspector to give you a detailed rundown on what you’ll need to do within the next five years, along with estimated costs. Surprises are very, very expensive…Thousand dollar on a hot water tank, five thousand on a HVAC system, ten thousand on a roof…can eat up all those potential profits in a hurry.
4) Selling a property for top dollar also costs money.
If you don’t want to deal with making repairs, updating kitchens, improving landscaping and overall cleanup, don’t worry. We buy Tulsa area houses for CASH, as-is. We help homeowners solve the problem, by making you a fair offer, and the peace of mind knowing the home will be fixed up properly and end up housing another individual or family, who will enjoy living there.
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 and can afford to maintain it.
6) Uncle Sam wants a piece of the action.
Don’t forget to discuss your inheritance with tax and legal professionals before you take action. There are major property and income tax consequences that will dramatically impact the cost of owning your investment. There are also ways of breaking up the proceeds when selling to us, that will allow you to spread out the tax implications. Just ask us if you’re interested in learning more about that option.
7) Consider all your options.
In certain situations we may be able to help you structure a lease-option agreement that allows you to rent and sell at the same time – capturing the best of both worlds. These kinds of deals can be complicated, but our Broken Arrow area investment experience can help you navigate this.
8) Compare a few scenarios.
We’ll help you determine prices for any property near Broken Arrow – 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).