You receive a free house through inheritance! How Awesome!
But is it though?
At first glance, inheriting a house may feel like you just win a lottery. Often times though, inherited house isn’t rainbow and unicorn at all. The fact is that inherited houses tends to be a money pit due to their ages and poor conditions left by the predecessor. When you own the property, you are now responsible for all the bills and problems that come attached with it. So while the best intentions may have motivated the inheritance of a property in Augusta, it isn’t always financially beneficial. For example, an inherited house that was neglected for years may need to have the foundation, roof, HVAC and appliances replaced; all of which can add up to tens of thousands of dollars to get resolved.
Not only do you have to clean up the physical mess that the predecessor left behind for you, there are also emotional problems to be dealt with. It is not looking pretty when multiple heirs are involved. You are not likely going to find a solutions that can please all family members. Especially when their money is at stake, family relationships can become tense, which ultimately add to your overall stress level.
Read on as we explore five things you should know about inheriting a property in Augusta.
Debt
Not many inherited properties in Augusta come without a great amount of debt, which can consist of multiple mortgages and lines of credit, unpaid taxes, or judgement liens. When you sell the property, all the lien holders will get the share of the sale price first. You receive your proceed from the sale only if there are leftover money after paying off the lien holders. As the result, it is paramount to understand how much your debt obligation is on the house before deciding what to do with the inherited property. When working with HBI Home Solutions, we will have our attorney perform a thorough title search, which will let you know exactly what liens are currently attached to your property and how much.
Taxes
While inheriting a property in Augusta doesn’t necessarily trigger more tax liability, you should know that your decisions about what you do with the property very well may. Should you make improvements, you can write these expenses off. There are also property taxes to consider; if they aren’t a part of an existing mortgage payment, be sure to familiarize yourself with any deadlines. Inherited property is subject to a step-up-basis adjustment in the value of the property upon which your capital gains taxes on any growth moving forward are based.
Maintenance Costs
As with any items, the older they are, the more expensive the maintenance cost is. You will have to take into consideration the time or money that you have to spend on routinely taking care of the property. If regular maintenance is skipped, you are guaranteed to have bigger problems down the line. There might be specialty equipment around the house that required a professional to get things done right. Pool equipment is a good example of this. It is strongly recommended to have an expert do specialized maintenance when inheriting a property in Augusta.
Repairs
Not only do you have to perform regular maintenance on the house, it is evident that you also need to do several repairs on the house as it ages. It’s a significant aspect of inheriting a property in Augusta. Before committing to own the property for the long haul, familiar yourself with the repair cost for the house. The easiest way is to have three licensed general contractors give you a bid on what it takes to turn over the house. Doing this gives you a better understanding of the average cost of repairs, and whether or not it is worth it to do them. Also, consider the level of risk when doing major work on the house. You may open up a wall or rip off the flooring to only find out that there are significant hidden damages. For this reason, it is wise to keep a healthy amount of cash on hand for these unexpected expenses. Always expect to spend at least 10%-20% more of what you think the cost of the renovation will be.
Listing Costs
The most expensive way to sell your house is to list it on the Multiple Listing Service (MLS) with a real estate agent. Costs like staging, repairs, professional photography, marketing, and showings can add up to a lot. Don’t forget the hefty 6% standard commissions of the sale price you have to pay real estate agents, along with the closing costs you won’t know how much until a few days before closing. Another issue is that realtors cannot guarantee when your house will be sold. You can potentially be waiting for months on end when selling an inherited property in Augusta
Or, you could avoid all of the expenses and contact a professional investor like the experts at HBI Home Solutions, who will make you a cash offer for your house as-is. The professionals at HBI Home Solutions will walk heirs through the process step by step, making this time a little easier on you. In addition, professional investors like those at HBI Home Solutions offer guaranteed closing dates. At HBI Home Solutions, we lay it all out on the table and compare what you’d profit from listing vs. selling directly, so you can make the best decision with your inheritance for your situation. We stop everything and take the time to listen at HBI Home Solutions, answering any questions; our pros can help you overcome any hurdles you may feel stand in the way. Working with an expert like the professional investors at HBI Home Solutions can help you learn more about your options if you decide it’s best to sell the property. It’s comforting to know experienced professionals will work with you as a guide like the professional investors at HBI Home Solutions will. Contact HBI Home Solutions at (706) 389-5419.