Inherited A House In Indianapolis? Know Whether It’s Best To Keep It Or If It’s Time To Sell.
If you’re like thousands of Americans who inherited a house this year, you may be asking yourself if it’s best to sell it or keep it. There are many factors one must consider when determining what the best course of action. In our latest post, we help you learn more about your selling options! Whether or not you knew about the inheritance, you might be faced with some unexpected challenges.
Consider the financial implications
First we must consider the financial responsibilities that go along with inheriting a house in Indianapolis. Is the house paid off (owned free and clear) or is it encumbered with a mortgage? The less you owe against the overall value of the house the more options you have available to you. If there is a mortgage, consider how long can you reasonably carry that mortgage before it becomes a financial strain? Owning a house can be expensive. Utilities, property taxes and unexpected repairs and regular maintenance can add up quickly.
Additionally, you need to know if there are there any unpaid debts or liens against the house? If liens exist, they will need to be satisfied or the lien holder could force foreclosure. When a house is inherited, unless there is a living will, it will need to go through probate. These costs vary, but typically cost between $1,200 and $2,500. The cost of probate can rise quickly if it is contested by others whom may have an equitable interest in the house. During the probate process, public notice and notice to potential lien holders is given. During this time, lien holders can come forward to claim any unpaid debts.
For some, the cost of assuming an existing mortgage may be out of financial reach or not worth the headache or hassle to keep it. There are a lot of variables to consider, so take your time and make sure you understand the implications and processes that you will have to go through in assuming ownership.
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Do you have a use for the property?
Some who inherit a house hold onto them for sentimental reasons. There’s nothing wrong with holding onto a property that holds special memories but unless you have a specific use for the house, there is no sense to just let it sit there. Houses don’t do well sitting empty. Vacant homes are vulnerable. There isn’t anyone who is checking on the house daily. A small water leak can lead to thousands of dollars of damage if not caught in time. Vacant houses can be a target for vandals and burglary.
Perhaps the inherited house would make a good rental. If you have the time to manage a rental property and if the property is in good condition, this could make for a nice supplementary income. But you must consider your equity stake in the house. We recommend that unless you owe less than 50% or the total value of the house, not to rent the property. You would simply be taking on too much liability with very little reward. By the time you make your monthly mortgage payment, cover the cost of any repairs or regular maintenance, property taxes and insurance, there is seldom much profit left over. Additionally, renter are not going to care for the house the same way as the owner. On-going wear and tear could leave you with negative profits and depreciate the house over time. Houses owned free and clear make the best rentals. Owners get to maximize their returns without giving most of the profits to the bank.
If the house is located in an area you would like to live, selling your existing house and moving may be an option. You would have to sell your exiting house quickly, especially if there are mortgages attached to both. Carrying two mortgages can quickly drain your financial reserves. Be sure to compare mortgage rates. Monthly payments can increase significantly as rates go up. Going from 3% to 6.5% in annual interest adds up quickly.
What’s the overall condition of the house?
After firmly understanding the financial implications with an inheritance of this kind is the overall condition of the house. This is not a time to look at your house through rose colored classes. Get real about the real condition of your house. This will save you and prospective buyers a lot of time and headache.
Is the house in move in ready condition or will repairs and updates be required. If you plan to sell the house you need to throughly evaluate its condition and determine exactly what it’s going to cost to make necessary repairs or updates to the property and get it ready for market.
Selling a house in Indianapolis that needs work is more difficult today than it used to be. The market is shifting from a sellers market to a buyers market. Buyers are becoming increasingly critical of the condition of a home. Buyers have options and with costs of purchasing a home near all-time highs, few are willing to fork over top dollar on a project house.
Be cautious about making repairs
Repairs, maintenance and updates to a house can be costly. Before you hand over thousands of dollars ask yourself these questions. How comfortable you are taking on the project or tasks that are required to get the house in move-in ready condition? What experience with home remodeling and repair do you have? Do you know anyone that can support you along the way, like a family member or friend who is a contractor or tradesman? Do you feel comfortable making decisions about design, color and architecture? Often times people who inherit homes invest considerable amounts of money rehabbing the house only to find that they choose the wrong cabinets, colors and layout. New isn’t always better. One must be in tune with current design trends and consumer demands in order to ensure they get top dollar for their houses. Real estate investors deal with these decisions every day. They know what styles and amenities are trending among consumers. If you make the wrong choices, it could end up costing you.
Are there other owners?
If there are other owners of the property, you will all need to be patient and reach a consensus among those with an equitable stake. It’s important to work together to decide if the home should be kept or sold. You can always consider buying out others stake in the property if a condenses can’t be reached.
Always remember, the is just a house and that the individual who passed it down to you would never want to see their gift become a problem. Be patient and remember that not everyone is in the same station in life. There are going to be those under financial strain or too busy to handle the details.
If the decision to sell has been reached you need to determine how much money can be invested upfront to get the house ready for market. The house needs to be cleared out and cleaned up. A traditional property listing will come with some upfront costs. It’s likely that you will need to make some repairs to the house and have it professionally cleaned. Making repairs to a house you’ve never lived in can be a bit tricky. You may not know what you’re getting yourself into. This is where a home inspection can come in handy. This way you know exactly what you are getting yourself into and where to allocate the greatest portion of your funds.
Regardless of which direction you go; before you make a decision about whether to sell or keep the inherited property, ask yourself a few questions. Take the time to learn about the market and the property in question. Below, we’ve outlined a few tips that will help you along this journey.
Ways you can sell your inherited Indianapolis house fast
Listing the house for sale
If you decide to list your inherited property located in Indianapolis, you will benefits by getting it ready for the MLS (Multiple Listing Service). Do a little research, looking at what other properties in your area are selling for. It’s important to note here that pricing a property is more an art form than science. It takes years of industry and local market knowledge to get it right and even the pro’s can struggle from time to time. Be realistic when considering prices and be careful not to over improve the property. This could result in lost profits.
Selling the house yourself (FSBO; pronounced Fiz-Bow)
Selling your inherited property using an FSBO listing will save you money but you will need to act as your own broker. Real estate agents and investors take a lot of the work out of selling your house. You may be able to pay a real estate agent to list your house on the MLS for a small fee, but you will have to coordinate showings with potential buyers, negotiate the sales price and navigate the property inspection. If you get any of theses wrong and it could end up costing you more than if you would have listed it with an agent in the first place.
Selling your house to a real estate investor in Indianapolis
Selling your inherited Indianapolis property to Ittenbach Capital is probably the fastest and easiest way to go. We take all the work out of selling and buy properties in as-is condition; no need to make any expensive repairs. There are never any out-of-pocket expenses; no expensive commissions, agent or administrative fees. You pick the closing date and we pay all closing costs. Join the thousands of Hoosiers who sold their house the easy way.
To learn more about whether to sell or keep your inherited in Indianapolis, or if you have any questions about working with an investor, then give Ittenbach Capital a call today at 317-731-2540. Or go online at www.ittenbachcapital.com and tell us about your house buy filling out our short form.
Ittenbach Capital is an accredited business with the Better Business Bureau with an A+ rating. Average customer reviews are 5 stars. Click here to see why customers give Ittenbach Capital 5 stars!