Many Michigan residents find themselves in the unique position of inheriting a house after a loved one passes away. Like others in this situation, you may have a million questions running through your mind. The main question many people face, however, is: What do I do now?
First steps to take
Before even considering whether to keep the property or let it go, you need to take a few initial steps. These first few tasks will make the rest of the process easier to understand further down the line.
1. Read the will
When inheriting property, this is an obvious yet surprisingly overlooked step. By educating yourself on every inch of the will, you’ll have a better understanding of exactly what property is included. Another important thing to consider is whether the will is valid. If you find yourself confused or overwhelmed, it’s always helpful to consult a professional.
2. Make a list
The house likely has personal items and other assets. Including these, the entirety of the property is referred to as the estate. Before proceeding, it’s important to make an itemized list of all assets included in the inherited property. This way, you can determine how much the estate is worth.
Another list you should consider making is the property’s needed repairs and upgrades. This is most helpful when considering whether to keep or let go of the house, especially if you plan to sell or rent it out.
3. Consult a professional
This is an echo from the first step, but it really is important to have a thorough understanding of the situation before moving forward. This includes connecting with an estate professional. Have a discussion about what taxes need to be filed during the transfer of title, and open a conversation about other necessary paperwork. The process of inheriting property in Michigan, or any US state, can get quite complicated, so it’s mandatory to consult with an expert.
Keeping (moving into or renting out) your estate
Let’s say you decide to keep the inherited property. This is usually done in one of two ways: moving in to the house yourself, or renting it out to tenants. Both options have their own procedures, but firstly, we’ll go over what questions need answers right away.
Is the property mortgaged? If it is, and if you plan to keep it, you should have a discussion with the house’s lender immediately about payment plans. Arrangements need to be made to pay off the home. An important aspect of inheriting property is to consider whether you are fiscally able to proceed maintaining the house. If the mortgage is out of your pay range, but you insist on keeping the property, your best bet would be to rent it out to tenants.
Is the property being foreclosed on? If you inherited property that is going through foreclosure, your best bet is to speak to a lawyer. Each situation is different and complex, so connecting with an attorney is vital. Having this discussion can inform you on how title is held and how you might proceed fighting the foreclosure, if that is your wish. In addition, check out our article on dealing with foreclosure.
If you do choose on renting out your inherited property, you’ll be met with a list of requirements that any new landlord has to be aware of. After consulting a professional about all previous tasks mentioned in this article, you should be free to begin renting your home. However, renting out property in Michigan is a whole other ballgame with its own complex procedures. To be fully aware of what needs to be done, check out our article on how to rent out your home.
Letting go of (selling or disclaiming) your estate
For any number of reasons, you may decide that the best option is to let go of the estate through sale or disclaim. This may be because estate taxes are too high, or the mortgage is out of your budget. It also may be that you plan to sell the home to a relative or close friend. Here, we will briefly go over each option.
Selling the property
If you aren’t selling to relatives – which is a generally easy process – your best bet is to sell to a cash home buyer. These companies purchase your inherited property for a fair price so you can forego a complicated sale transaction and closing costs.
Disclaiming the property
If you don’t have the time or resources to inherit the house, you could always disclaim it. This means you are relinquishing your legal rights to ownership. Disclaiming the house will usually pass it on to the next beneficiary.
The main points to know when disclaiming an inherited house is as follows:
- The disclaimer should be in writing.
- Deliver the written disclaimer to the estate’s executor or trustee (person currently in control of it).
- You have nine months from the date of your loved one’s passing to complete the disclaimer.
Thanks for reading!
Ultimately, inheriting property means that you likely lost someone you love, so our condolences to you. While this can be a sticky or complex process, the best step to take is to consult a professional. If you plan to sell your inherited home, consider selling to us. We buy homes for a fair cash price in the Oakland and Macomb Counties. Scour our website for more info and feel free to reach out for any inquiries!