Many might think that inheriting a home is the silver lining to the devastating blow of losing a parent. Certainly, inheriting a home can be an excellent way to keep the family legacy alive and to acquire a valuable asset. But what if you inherit a home with a mortgage that has yet to be paid off? Sure you’ll get the property, but you’ll also inherit the loan. This comes with a range of issues you’ll have to attend to. In the end, you may decide it’s just not worth it or that you can’t afford the payments. What do you do if you decide you don’t want the home or realize you simply can’t afford it?
So What to Do When You Inherit Your Parents House?
When you inherit a home, the law states that the lender has the right to require the full payment of the entire balance of the loan. The majority of mortgages have “due on sale” clauses that let the lender insist on the remaining balance of the mortgage when the home is passed on. When you inherit your parent’s house, and the loan is still in place, you’re still responsible for all payments until the mortgage is paid off.
In an ideal situation, the will addresses how the mortgage should be handled, dictating how the executor of the estate should pay it off. Once the mortgage is paid off, the home is yours to enjoy, free and clear. This situation, however, is a rarity. Even if the house is paid off, you will need to still pay for the taxes every year, HOA fees and other holding costs associated with keeping the newly inherited house. If the will doesn’t state anything concerning how to pay off the loan, then you will assume all responsibility.
Of course, you may still decide you don’t want the property. Perhaps you can’t afford the mortgage, or, the property could be in such bad shape that it’s more cost-effective just to get rid of it. If there’s equity in the property, but it’s still not wanted by any of the descendants, then the executor of the family estate must sell the property, distributing the proceeds of the sale to the other beneficiaries. Either way, if you can’t make the mortgage payments, you will face foreclosure.
If you decide you want to the sell the property after you inherit it, you still have to make the mortgage payments until the house is sold, and selling a home can take some time. Selling a home also comes with all the requisite stresses of being a seller – making sure it’s in good condition inside and out, posting to the MLS, hiring a REALTOR, being available for showings at any time and the like. It’s not fun, and if your parent has just passed away, it’s often the last thing you want to be dealing with.
If you want to get rid of the property and don’t wish to take on the burden of selling the home, there are resources to help you sell the property quickly in a cost effective, legal and stress-free manner.
At Lennox Home Buyers we buy inherited Houses in Houston TX and surrounding areas, you won’t have to spend a penny to unload your property and our professionals will buy the home “as is”, paying cash and handling all the traditional closing costs and fees.
If you have inherited a house in Houston that you don’t want, this could be your best option. You can liquidate the property without waiting to find the right buyer, which very often takes many months or years. You won’t have to deal with lengthy and complex loan approval processes, and ultimately, you’ll be able to mourn the passing of your parent, have the cash to handle the aftermath of the funeral arrangements and take the time needed to re-adjust to life without them. Hopefully this article gave you more insight on what to do when you inherit your parents house.