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.
You’re thinking, “I inherited a house, what to do with this house?” Should I rent it? Should I sell it? How should I sell it?
Tons of options open for you, but…
… we can help.
We’re seasoned investors in Southwest Michigan real estate, and we’re looking to buy several houses each month in the Southwest Michigan MI area. Every month we get calls from those who have inherited a house and are looking to sell the house… so the info below are some tips to help you navigate the process.
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 is paid.
If you inherit a property with a mortgage, it’s important to understand that you’ll have to pay it off if you want to keep the property. While some banks may allow you to assume the existing loan, others may require you to refinance into a new loan. If you’re not able to qualify for a new loan, renting out the property may not be a feasible option for you. It’s important to carefully evaluate the financial implications of inheriting a property with a mortgage and to seek professional advice if needed. Inheriting a mortgage-free property is ideal, as it eliminates the burden of having to make mortgage payments, allowing you to focus on maximizing the property’s potential as an investment or rental property.
2) The investment is only as good as the manager.
However, if managing a property isn’t something you’re interested in, it may be best to consider hiring a professional to help you. Property management involves dealing with brokers, maintenance, tenants, rent collection, and all the nuances that come with it. It can be time-consuming and stressful, so having an expert on your side can make all the difference. On the other hand, if you don’t want to deal with the hassle of managing a property, you may want to consider cashing out now. While some people choose to keep the inherited property and rent it out for extra income, it’s important to be aware of the responsibilities that come with being a landlord. Ultimately, the decision to hire a professional or cash out will depend on your personal preferences and circumstances.
3) Property ownership costs money.
It’s essential to acknowledge that inherited properties often require significant repairs or renovations. It’s rare to come across a building that has been perfectly maintained, which is why it’s crucial to get a detailed understanding of the work that needs to be done. Consider hiring a professional property inspector to assess the property and provide you with a rundown of what needs to be done in the next five years and estimated costs. By being aware of potential problems beforehand, you can plan for the expenses and avoid any surprises that can be costly in the long run.
4) Selling a property for top dollar costs money.
Another option if you don’t want to deal with the hassle of making repairs and improvements to an inherited property is to sell it as-is for cash. Many real estate investors specialize in purchasing properties quickly and with cash, allowing you to avoid the lengthy process of listing, marketing, and negotiating with potential buyers. By selling your inherited property for cash, you can avoid the expenses and time involved in repairing and updating the property, as well as the costs associated with traditional real estate sales, such as realtor commissions and closing fees. If you’re considering selling your inherited property in Southwest Michigan, reach out to a reputable real estate investment firm to explore your options.
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) Uncle Sam wants a piece of the action.
Before taking any action regarding your inherited property, it’s essential to discuss your options with both tax and legal professionals. The tax implications and potential income tax consequences of your inheritance can significantly impact the cost of owning the property. A qualified professional can help you navigate the complex regulations and ensure that you make informed decisions that will help you achieve your financial goals. So, make sure you consult with experts to avoid any surprises and potential issues down the road.
7) Consider all your options.
If you’re in a situation where you need to sell your property but also want to continue renting it out, a lease-option agreement might be the perfect solution for you. With this type of agreement, you can rent out your property while also giving the tenant the option to buy it at a later date. This can be a win-win for both parties, as it allows you to generate rental income while also potentially selling the property at a higher price later on. However, these types of agreements can be complex and require careful consideration of legal and financial issues. Fortunately, our team at I Buy SW MI has the experience and expertise to help you navigate these types of deals and come out on top.
8) Compare a few scenarios.
Our team of experts can assist you in determining the ideal prices for your properties located near South Haven, including the highest possible price the current market will pay for your property as it is, without any improvements or renovations. Additionally, we can provide a projected value for your property if you choose to keep it as a rental, along with a comprehensive breakdown of all associated costs. With our in-depth knowledge of the local market and years of experience in real estate investing, we can help you make informed decisions that maximize your investment returns.