Selling A House After Death Of Parent (Complete Guide)
If you're reading this, you might be going through a tough time. Losing a parent is never easy, and having to deal with their estate and sell your family home can be overwhelming.
But I'm here to help.
In this post, I'll walk you through the whole process of selling a house after death of a parent.
I know that this is a difficult time for you, and I hope that this guide will make the process of selling your parent's home a little bit easier.
1. The Inheritance Process
Before you can sell your parent's house, you need to know how they wanted you to get it.
There are three main ways:
- Through probate court
- With a transfer on death deed
- Through a living trust
Probate court oversees the distribution of your parent's entire estate, including selling the house. It takes a long time, sometimes even years!
Also Read: Can You Sell A House In Probate
A transfer on death deed lets you get the house directly without probate in some states.
If your parents had a living trust set up, the paperwork says how to manage and give away things like the house. This can make it faster and easier.
2. Find Estate Executor And Notify Creditors
You may think that since you are inheriting the house, you can make all the decisions about selling it. But that's not always true.
Your parents probably picked one person to be in charge of their estate after they died - this person is called the executor or personal representative.
The executor is the one who gets to decide what happens with the house sale.
If your parents didn't pick an executor, then all the people inheriting the house (the heirs) may have to agree on decisions together.
This can lead to arguments if people disagree.
So it's really important to figure out if there is an appointed executor early on.
You also have to give official notice to any companies, businesses, or people that your parents owed money to when they died. These are called creditors.
The creditors may have a legal right to get some of the money from selling the house to pay off the debts they were owed.
3. Get All Heirs On The Same Page
If you've got siblings or other heirs involved, you all need to get on the same page about the responsibilities.
Who is going to clean out the house and get it ready for sale?
How will the money from selling the house be split up between the heirs?
Sit down with your co-heirs and work through all those details upfront. It's common for siblings or other heirs to disagree about things like this.
If you can't come to an agreement amongst yourselves, you may need to hire a mediator.
A mediator is someone who helps people resolve conflicts without going to court.
4. Hire An Real Estate Agent
Don't just hire the first agent you find.
You'll want someone who's actually done inherited property sales before and can guide you through probate issues, heir disagreements, and all the other issues that come with it.
And don't forget - you'll also want an agent who is compassionate and patient.
You're grieving a parent, and the process can bring up a lot of emotions when you're having to let go of your childhood home.
Also Read: Selling Inherited Property
So you want someone who lets you work through that and doesn't rush.
Nothing's worse than some clueless agent just looking to make a quick commission who can't empathize with what you're going through.
5. Manage Your Parent’s Finances
When you inherit the house, you aren't just inheriting the property itself. You also inherit any debt, loans, mortgages, taxes, or other bills attached to the house that your parents still had.
So you need to track down all of their financial accounts, statements, and records of bills as soon as possible.
You may also find liens or legal claims against the house that need to be resolved.
You might even have to run a full title search just to get a clear picture of what you're dealing with. It's a huge pain, but a reality you can't avoid.
And you have to keep paying the mortgage, taxes, utilities, and other expenses until it gets sold.
If bills go unpaid, it can mess up the sale or even put the house at risk.
6. Distribute Personal Belongings
Before you list the house, you need to go through all of your parents' personal items and belongings - things like photos, furniture, and that ugly vase your aunt really likes.
Also Read: How To Sell a Hoarder House
Check their will to see if certain items were specifically left to certain people in the family.
Make sure those special items get given to the right people named in the will.
For everything else that's left over, you may want to have an estate sale.
An estate sale lets you sell off all the extra stuff to get it out of the house, and you can make some extra money too.
7. Prepare The Home For Sale
Once the house is cleared, you'll need to prepare it for sale.
You'll probably want to do a really deep, thorough cleaning of the whole place. You may also need to make some repairs or renovations to help increase the home's value.
Also Read: Does new furnace increase home value
If that sounds like too much work, you can always just sell the house as-is in its current condition, though you likely won't get as high of a price.
But that could help you avoid a hefty capital gains tax.
No matter what you decide, you have to be honest about anything unusual or important - like if someone actually died in the house.
8. List And Sell The House
Your real estate agent will look at recent comparable home sales in the area to help decide the right price to list your parents home for sale.
You'll also need to weigh the potential tax liabilities.
Sometimes, setting a lower asking price that avoids really high capital gains taxes is smarter than trying to get every single last dollar you can out of the sale.
After you decide that, list the home and follow the normal house sale process.
You could skip this whole process and even sell the house to a cash buying company. That way you don’t need an agent.