Inherited a House in Gladstone?  Do you understand the process of administering the estate and dealing with the property?

What is the Probate Process for dealing with an inherited home?  It’s the legal process by which the estate is closed out, assets are sold or transferred and the bills of the estate are paid.  It’s not all that hard, just takes some understanding and some time.

How to Avoid Getting Scammed When You Inherit a House

Probate Process for a House in the KC Metro

If the deceased did not take the time to set up proper planning to close out his estate, usually with a trust and a will, then the courts will require the assets to go through probate.  Probate is simply the legal process by which the court makes sure the debts are paid and the remaining property and assets are distributed to their heirs.

Usually, there are 4 steps in the process.

1. First, the court is involved with the executor filing a petition to be appointed an executor of the will or an administrator of the estate if there is no will.  The court will set a date and a hearing will be held to name the executor or the administrator, let’s call them a personal representative.
2. After the court appoints the representative, then it is their time to give notice to all creditors to send in their bills and the representative will make an inventory of the estate so the court can know what assets there are.
3. Once all the creditor’s claims are in within the given time limit, the representative will pay all the debts and taxes from the estate.  Sometimes this may require the selling of some assets to pay those debts, assets like stocks, bonds, houses, etc.
4. Once debts are paid assets are then distributed according to the will or state law in the case of no will.

But throughout the four-step process, there are a few scams that could pop up that you need to know about

Common Scams where the Family gets Screwed

Most scams target those that just don’t know any better, we hope that by providing them here, you will be aware and in the know.

1. Probate Avoidance Scam – These are usually put into place before your loved one dies and the scammer targets them by persuading them to buy legal documents or kits that they can put into place to avoid probate.  And while having a proper Trust in place can help avoid probate, you want to deal with a reputable firm.  Ask friends and family for a referral to a good, local attorney who can help set up a proper legal trust.
2. Inheritance/Estate Tax Scam – Some states have an inheritance tax.  In this scam, the perpetrator will pretend to be some trusted legal person and they reach out to fraudulently collect this tax.  Note if you live in an area like this, get advice from the local funeral home or your own attorney on what needs to be paid and to who.
3. Fraudulent Listings Scam – This one is really interesting and affects just about any house offered for sale.  In this scam, the perpetrator copies your listing of a home for sale and then posts it for rent on all the online sites.  They in effect rent out your house to an unsuspecting renter and collect their first and last months rent.  So, when you have a vacant house for sale.  Check on it regularly.  When you market if or sale yourself or with a Realtor, search the address online every few days and if you see it marketed by someone you don’t know,  go double check on the house to make sure the locks have not been changed.
4. Stealing the Deed: In this scam, also called deed fraud, noting that the house appears to be vacant the thieves forge documents to get the property deeded into their name and sell the house or pretend to be the deceased owner and sell the house.

If you’re facing probate, it’s not as tough as you might think.  And it is important to note that selling the house in the estate sooner rather than letting it sit vacant for a long time can save you money in taxes, vacant insurance, utilities, and maintenance as well as checking on it to make sure no strangers have moved in.  Check with your attorney and the probate court to find out how to sell before the probate process is complete.  Money in the bank is much easier to manage than a vacant house somewhere.,

If you’d like to learn more about probate and how to get through it smoothly, check out our free book on dealing with an inherited house here on our website.

It was great not having to go in and clean up that unholy mess and worry about disposing of everything.  I hope you guys make a good sale on the property, I’ll be only too happy to refer you to others.

Crystal on the Olathe House

Thank you, Scott, that house has been a stone around my neck for the past ten months.  I’m so glad that your mom friended me on FB and got things rolling, I’ve had a lot of deaths in my family in the past seventeen months,(my father, my estranged husband, and my only sibling–my brother. I have been swamped trying to deal with it all simultaneously.  You guys took me by the hand and drug me through what needed to be done, and I appreciate that.

The post Inherit a House in Gladstone – Don’t Get Screwed appeared first on kcmohomebuyer.

Are you an attorney working on behalf of the heirs in an estate?

We have worked with quite a few attorneys and heirs over the years and we would like to dispel a few myths.

Myth #1:  Appraisal Value is the Value of the Home

We understand that as an attorney representing an estate that you have to find some basis in value and an appraisal is a good place to start.  However, when you start marketing the home for sale, if you are not getting any offers, your price is too high.

Case in Point:  We were working with an attorney representing over 25 rental homes in Kansas City Missouri.  All were occupied and paying rental units and they were appraised at a specific value.  The attorney representing the estate was marketing these homes at appraisal value for over a year with no movement to lower or negotiate on price.  Ultimately because of this and a few other factors, these homes sold at a fraction of the original sales price over a year later.

Another, Bonus Myth, is that if the estate owns a bunch of houses, it’s better to sell them all together.  Sure, give selling the entire package a shot, but if it’s not working, break it up into smaller packages or even sell individually.  Sure you might take a loss on some of the less desirable houses, but that might be made up in a higher price on the nicer units.

Myth #2:  The Estate Can’t Afford a Property Manager or a Realtor

Yes, many estates have limited budgets.  However, if the estate decides to work without the benefit of a professional, it could cost the estate substantially in time and money.

Case in Point:  Same estate as above that could not afford property management.  The estate attorney instead worked very hard to manage the rentals and determined a vacant house is much easier to manage than a paying tenant, less time for the attorney and less billable hours to the estate.  However, in rental property, much of the value is in the rents coming in.  So removing the tenants from the houses overall lowered the value of the homes.  And vacant homes over time get vandalized, further lowering value.

Myth #3:  I Don’t Have Time to List It

We see other estates where the attorney tells us that they don’t have the time to work with a real estate agent.  That’s great for us, we would love to make a cash offer closing next week.  But, consider, even that trashed house that needs cleaned out, cleaned up, and remodeled can be listed and sold at a premium if you work with the right agents.  Because we sell fixer-uppers to real estate investors, we have a huge buyers list of investors looking for fixer-uppers.  We also know how, as Realtors ourselves to list and market a fixer-upper in MLS to get the highest possible price in the shortest amount of time.  We have bought estate houses to sell them cash in less than a week multiple times over the years.  And we would love to do that with your house.  But in some cases, we can sell it even faster and at a higher price that would net the estate more than our cash offer even after paying us a real estate commission.  We would net about the same in profit versus commission and it’s a cleaner more transparent transaction for everyone.

Myth #4:  The Estate Needs to Fix It Up First

We are not sure who tells the heirs this myth.  Maybe it’s their attorney, maybe a Realtor, or maybe a friend.  Here in our office, we sell completely trashed houses as-is all the time, the key is in pricing it right and marketing it to the right buyers.  Sometimes we might get it cleaned out sometimes we sell it with all the stuff, it all depends on the house.  Other times we feel the most likely buyer might want one or two items repaired, like the roof or the furnace and we leave all the cosmetic items for the end buyer so they can build sweat equity.

If you are an Attorney representing an estate, we invite you to reach out to us and have a discussion.  We can do several things for you.  First, we could come to view the property and make you an all-cash, fast-close offer.  You can rest assured that with that offer we will be closing on the day specified.  We can also consult with you on listing the home, especially the higher-priced estates with values over $400,000.  We have several cash investors whom we market our houses to who would love to buy your house either from us if we were to buy it and resell it or from us as your listing agent.

Ready to start a conversation?  Fill out the form.

The post Some Tips for an Attorney Helping Heirs Settle an Estate appeared first on kcmohomebuyer.

Need to sell an Inherited House Fast?

When you inherit a house and you want to sell it, there are two ways to go.  You can sell fast to an investor or you can take your time and list it with a Realtor. Ok, there is a third option, keep it.

First of all, please note that if the estate is going through probate, you do not always have to wait for the whole probate process to be completed.  You can often sell the house and the cash proceeds from the sale can go through probate depending on the value of the home, the court may need an appraisal.

But back to Investor or Realtor.

Payments:

The Investor buyer is either going to offer you an all-cash transaction that pays you all cash on the day of your choice or you might get a slightly higher offer price that would be on terms with payments made to the estate.  Here at kcmoHomeBuyer.com, we prefer the all-cash option as most sellers just want their house sold.

You could also list with a Realtor, but you have to pay the Realtor commission. And quite often, going the Realtor route, the buyer is getting a loan and that is about a 45-day process and could cost you more money if they need repairs made to get the lender to make the loan.

Selling “As Is”:

This is probably the best benefit to selling to an investor like Kim or Scott here at kcmoHomeBuyer because we buy houses “as is”.  This means you don’t have to repair, clean, or stage your house.  You have no work involved on your part, sign the contract and go to closing.  We clean it out, we clean it up and we fix it up – that’s what we are in business to do.

With a Realtor, you can also sell as is, but typically most agents are going to want you to at least clean it out and clean it up so it shows the best.

Fast Closings:

With an Investor, you can usually get the property closed, get your money and go on with your life in as little as 7 days.  With a Realtor you typically have 1 to 2 months “getting ready”, unless they will list it as is.  Then you have 1 to 2 months or longer finding a buyer for it.  Then if the buyer is getting a loan, another 30 to 45 days.

Below Market:

Yes, when you sell to us, we are in business to make a profit.  We are stepping in your shoes and will have to spend the time and money getting it ready to sell.  We will be paying the upkeep for the 3 to 4 months it takes to turn it around.  So we do buy at a discount.

Remember we are buying fast for cash, we often pay your closing costs as well as our own, we pay for the repairs, often we pay back taxes, plus the holding costs.

Scam Artists:

You do need to be aware that there are scam artists out there posing as investors and others who are just so new to this business that they do not have the cash or the knowledge of how to do the deal.  They usually will want to put your house under contract, often without any negotiation, paying you whatever you are asking.  Then they take the next 60 to 90 days to try to find someone who will buy the house from them.  When they can’t, because they are paying you too much, they give up and back out of the contract.

So when you have inherited property and you need to move it quickly, you might consider an investor.  You can make the phone call, show the house, write the contract and get the money in a matter of days.  Now if you have the time and the man power to clean it out and clean it up, and the time and the money in the estate to wait out a Realtor listing and pay for inspection repairs, then by all means work with a Realtor, we are partial to our sister company Realty Resource as they know how to list a less than perfect house and get it sold fast.

When you are ready to sell, or if you just want an idea of what we might pay you for your inherited house, you can take a minute to learn more about us and another minute to see how our process works. Then fill out one of the forms on our website to get in touch.

Stop The Search…Start The Process Here!

The post I need to sell an inherited house fast, can you help me? appeared first on kcmohomebuyer.

Today we take a look at 3 financial options you can pursue when selling an inherited property …

When a loved one passes and leaves you with a property, while they may mean well, owning an inherited property may not be for you. You will suddenly have all these additional bills for the property with maintenance, upkeep, and possibly needed repairs. It can be stressful and it can be time-consuming.

So if you have inherited a property that you don’t want and are thinking of selling, keep in mind you have options. Your first thought might be selling with the help of a real estate agent. However, you might be surprised to learn that you have other options you may not have thought about.

In fact, did you know you have several options you can pursue when selling an inherited property?

First, Let’s Talk About Selling Through An Agent…

There’s nothing wrong with selling through a real estate agent but you should be aware that an agent may want you to fix up the inherited property first. Then there is always agent commissions you’ll have to pay out of your proceeds. And, this method can take months, so some people don’t like how long it takes.

If you would like to go the Agent Route but don’t have the time, the money, or the expertise to make updates and repairs or maybe even empty the house, please know that there are a few agents out there that specialize in listing homes as they sit. They work with you to list it at the most optimum price for the condition of the home as it is right now with no repairs, no nothing.  You do nothing but provide the agent with the keys, they put a sign in the yard and they market it as it sits.  The Home will not command top dollar, but it will get the most buyers into the house and potentially sell for the most money.

This route will take some time and during that time the house still has utility bills, real estate taxes, insurance, and yard upkeep that are racking up bills.  Plus the agent will have a real estate commission that needs to be paid.  If you are looking for an agent that will do this for you, we have an agent on our team that will do this for you.  When you call, ask us about listing options from Realty Resource.  This is a very good option also if you are dealing with property that was a rental property or investment property, to begin with.

Now, Let’s Look At The Other Options…

Non-Financial Option. Move-In

We have worked with people selling an inherited home that they moved into when their loved one passed away or maybe they already lived there.  We have purchased numerous homes where the last living parent had passed and the child or grandchild moved in.

In some cases, this was a great fit for the child or grandchild, but the memories get to them and they call us to buy it fast.  In many other cases, the child just does not have the financial means to maintain the home, we have purchased many homes that the child had inherited and thought, wow, free house.  They did not take into consideration the expenses of property taxes that needed to be paid and homeowner association dues that need to be paid.  Both the county and the homeowner associations will eventually foreclose on a house if these are not paid.

So before you move in, make sure you have the financial means to own the house and that means the ability to pay the mortgage over the long term if there is one as well as the ability to pay county taxes and the homeowner association dues.

Financial Option #1. Refinance

One option, which is a type of selling, is to refinance the property with a bank and use that money for other things. Although you’ll still own the house, and all the obligations that go with owning a house,  this is a financial option that some people might consider if they are selling in order to get the money.

With the refinance, you then have the funds to make the fix-ups necessary.  But again this is racking up time . . . time to refinance, time to make the repairs, time to list it and market it, and time to get the buyer closed.

With the refinance, you could also move into the home yourself, or rent it out as well.  Do keep in mind the costs of owning the home and maintaining the mortgage.

You can still use the house, or rent it out, and you’ll need to pay back the loan to the bank, but it’s one option to consider.

Financial Option #2. Rent It Out

Another option to consider is renting the home to a tenant for cash flow.  Still keeping in mind the financial obligations of the mortgage, taxes, and HOA, plus upkeep associated with owning the house.

But before you decide you want to be a Landlord or a Small Business Housing Provider as the industry would rather be referred, do your homework.

First, you need to know laws and basic regulations so you don’t end up getting sued for asking a potential renter the wrong question for not accepting a potential renter. The rules and regulations are changing rapidly and COVID and the eviction moratorium have just sped up this process. There are so many Fair Housing Laws that can be unknowingly be violated and cost hundreds of thousands.

Next, you need to have good forms and documents. Rental Applications, Leases, Move-In Checklist, Move-Out Checklist, Pet Lease. What if they don’t pay? What if they want to blame everything on COVID? We suggest getting good forms and lining up a good attorney to help you through all of this.

Third, you need to have a good handle on the money. What should you charge in rent? How much should you set aside for repairs? And if you didn’t know, studies show that only about 7 to 9 cents of every dollar coming in from rent is profit. If you get a free inherited house, those numbers do improve.

If you decide to rent out your inherited house, we highly recommend working with a good property manager. Not only can they help you with everything you don’t know, but they can probably save you money, get you more in rent and keep you out of jail or at least from being sued over a fair housing complaint.

We have purchased quite a few houses from heirs that went with this option.  They found the joys of being a landlord were not for them.  So they put the home up for sale after their renter moved out or got evicted and left them with a huge mess and lots of damage.

Financial Option #3. Sell Fast For Cash

One little-known option that owners of inherited properties might enjoy is the ability to sell the house fast for cash. Instead of selling through an agent (and hoping they can find a buyer, which can take a while), you can work with a house-buying company (like what we do here at kcmoHomeBuyer) and they’ll often buy your house as-is for cash, usually in as little as a few days. It’s fast, simple, and doesn’t require any work.

There you have it! 3 financial options you can pursue when selling an inherited property in Kansas City!

Double-Check Your Insurance

We do want to offer you one other word of advice, whatever option you choose, please consult with your insurance agent to determine if the insurance your loved one has on the property will still cover the home in the option you choose.  We have seen many an heir that had the home sitting vacant while they determined their course of action, during that time something happened to the home, and when they went to the insurance company, the company said sorry, the home was vacant for more than 30 days and despite you keeping the premiums paid, we will not cover your loss.

Thinking about selling your inherited property fast for cash or for payments over time?  We can help! Click here now and fill out the form.

The post Options For an Inherited Property in Kansas City appeared first on kcmohomebuyer.

Do you know where Mom and Dad kept their stash?

If you inherit a house, here’s where to look.

We buy houses and we find all kinds of things in houses that get left behind.

There was the little entry table in Lee’s Summit that had a bag of weed tucked up behind the drawer that fell out when we picked it up.

There have been multiple guns tucked up above rafters and behind beams in basements and attics.

We have heard of a friend who bought a hoarder house in Kansas City and when they cleared out the 2nd floor, they found a door that went to a whole other floor with 2 more bedrooms and a bathroom that no one knew about. And in that same house as they went through all the stuff with a fine-tooth comb they found a piece of jewelry worth more than the little house.

We bought a house in Blue Springs once where the kids were afraid to sell the house with all the contents because mom and dad had tucked away all kinds of things in books, bags, boxes, drawers, pockets, and more – money, bonds, account records where more investments were stashed.

This past week we were reading the AARP magazine and it had a great article about where Grandma Hid Her Cash and we wanted to share it, just in case you have inherited a house. You never know you might find a fortune hidden away.

So here’s the list from AARP

• Inside Toilet Tanks
• Frozen in Ice in the Freezer
• In a food box in the pantry / cabinet
• Tucked in Books on the Book Shelf
• Under the Floor Boards
• In Old Trunks
• Pockets or Boxes in Closets
• Hidden Drawers in Furniture

We have a few other suggestions:

• Under Cushions on the Couch
• Mason Jars in the Root Celler / Basement
• Taped to the Bottom of Drawers
• Cigar Tubes in the Junk Drawer
• Old Desk Cubbies
• In Shoes
• The Cookie Jar
• Pots and Pans

And don’t limit yourself to just cash. Who knows if there is an heirloom piece of jewelry or some antique that you didn’t know was worth a fortune? Usually, it’s not worth anything, but you might google it to make sure. When cleaning out Grandpa’s house last fall, there were spice cans from the 1950s. He just thought they were spices, but we googled it, the cans themselves were worth about $20 bucks, and all those cookie cans with pictures on top – we sold them for 25 cents each and now we see them in antique malls for $20 to $40.

If you have inherited a house and go through it to make sure you have found everything of value.

The post Inherit a House – Look for the Stash! appeared first on kcmohomebuyer.

Often, homeowners leave their house to beloved family or friends with the best intentions. Other times, the house gets left to whoever the court says gets it. While it may seem like a windfall when you find out that someone has inherited property, the realities are not always so wonderful. It can be beneficial to understand the problems that could arise for those who get the house, so read on as we explore the five downfalls of inheriting a house.

Distance

If you live across the country, distance can cause issues when you’re inheriting a house in Kansas City.

We have seen many executors of estates who live out of the area who have to take several weeks off from work, sometimes multiple times to fly into Kansas City and deal with the house. Cleaning it out takes time, getting it ready to sell takes time, and dealing with other families takes time. Often time that is filled with sadness at loved ones passing and anger and fighting with other heirs when they can’t agree.

We have helped many families through this situation. In most cases, they got together and went through the house because they just didn’t know what mom and dad had hidden away in drawers and closets, one family found all kinds of financial statements to accounts they knew nothing about. We have helped other sellers who didn’t care one bit about anything in the house, leaving everything, except the vintage motorcycle with the house.

When you inherit a house in the KC metro and live out of the area, working with a highly reliable local representative, like the Tuckers is a must. We can provide you with the assistance you need to take care of business, no matter where in the world you are located. We have services that can help you clean out the house and make repairs, or just skip it and leave all the hard parts to us.

Unified Decisions

Several people are often listed together on the will, and inheriting a house can become highly complicated if you cannot agree on the steps to take with the property.

We’ve had to have a contract make the rounds by mail to 20 different people who all needed to sign the contract, which was fine because we had 6 months to work through the probate process. We have had another situation where the sister didn’t trust her brothers to pay her the 1/3 of the proceeds, so we had to work out a way for her to get paid before she signed the closing papers, just to make sure she was satisfied.

What we do know is that when there are several people involved in making decisions, everyone has to agree. To do that you need the facts laid out clearly and concisely so you can compare a hands-off, all-cash, fast closing offer to the costs of doing a little work and then listing the home as-is, or doing a lot of work and listing the home as repaired.

We can help you explore your options, compare timelines and costs, and help you get the best outcome for you and your family.

Clean Out

It can be highly emotional after losing your loved one and finding yourself going through belongings and cleaning out the property when you are inheriting a house. Many people find the experience extremely overwhelming.

One benefit of making a direct sale to someone like us is that our full-service team will clean up the property inside and out. So you can just take what you want and leave the rest to us!

Expensive

Inheriting a house means inheriting the monthly bills and responsibility for repairs and maintenance, along with any debt legally attached to the property. Unfortunately, few properties come to their beneficiaries in perfect condition. Often the home has fallen into severe disrepair, and overgrowth is now threatening the structure.

Should you find yourself in a situation where you have inherited a home and you want to sell, but not do all the work, give us call. We are legitimate cash buyers with a very transparent process. Just submit your property here on our website to see what we might offer. Costs you nothing and can save you countless hours of work.

Time

In many cases, financial obligations that accompany the property may dictate a fast sale. Cash buyers often try to use this to their advantage, making insultingly low offers. However, you won’t be taken advantage of when working with us. Our offer comes with a guaranteed closing date without any pressure. Plus we have the flexibility to set the closing date around your schedule to make the sale as convenient as possible for you.

Are you inheriting a house and unsure about the next step? Reach out and will answer any questions or concerns to help you reach a consensus on an educated decision, with no obligation. Get started today, and submit your property with our form.

The post 5 Downfalls of Inheriting a House in Kansas City appeared first on kcmohomebuyer.

You’re thinking, “I inherited a house, what to do with this house?” Should I rent it? Should I sell it?  How should I sell it?

You have options and we can help.

We’re seasoned investors in [market_city] real estate, and we’re looking to buy several houses each month in the [market_city] [state] area. Every month we get calls from those who have inherited a house and are looking to sell the house… so the info below are some tips to help you navigate the process.

I Inherited A House, What To Do Next?

Here are a few important considerations to help you make the right decision:

1) Make sure the mortgage is paid.

This may sound obvious, but if the person who left you a property also had a mortgage (unless it had no mortgage and was paid off, which is great!), you have to pay it (assuming you want to keep the property). Some banks will allow you to assume the loan, while others may force you to refinance into a new loan. If you don’t qualify for a new loan, renting may not be an option for you.

2) The investment is only as good as the manager.

If dealing with brokers, maintenance, tenants, rent collection and all the nuances of property management isn’t the best use of your time, hire a professional to help you or cash out now.  Some people who inherit homes decide to keep the house and rent it for extra income. That’s a great strategy for sure. You just need to be prepared to manage the property and the hassles that can go along with tenants and toilets.

3) Property ownership costs money.

It’s rare to see a building that’s been perfectly maintained. Most inherited houses need major improvements.

Consider hiring a professional property inspector to give you a detailed rundown on what you’ll need to do within the next five years, along with estimated costs. Surprises are very, very expensive.

4) Selling a property for top dollar costs money.

If you don’t want to deal with making repairs, updating kitchens, improving landscaping, and overall cleanup, don’t worry. We buy [market_city] houses for cash, as-is.

5) If the market will continue to grow faster than your other options, hang on to the investment.

We can help you analyze the value of your property today versus the long-term benefits of renting. If you can use the equity in your property in another way that outpaces the performance of the real estate market, you should. If you don’t have anything better to do with the money and the neighborhood is rising in value, hang on – real estate can be a great investment if you know how to correctly read the market.

6) Uncle Sam wants a piece of the action.

Don’t forget to discuss your inheritance with tax and legal professionals before you take action. There are major property and income tax consequences that will dramatically impact the cost of owning your investment.

7) Consider all your options.

In certain situations, we may be able to help you structure a lease-option agreement that allows you to rent and sell at the same time – capturing the best of both worlds. These kinds of deals can be complicated, but our [city] investment experience can help you win.

8) Compare a few scenarios.

We’ll help you determine prices for any property near Raymore – if you sold it today without doing any work, the highest price the market will bear, and the projected value of keeping it as a rental (along with the costs).

Find out how we can make you a fair cash offer on your inherited house today!

The post I Inherited a House in [market_city], Now What? appeared first on kcmohomebuyer.

The Probate Process

Today we want to take a look at the questions of what is probate and when is it required.

What is Probate?

Probate is the legal process through which a deceased person’s estate is properly distributed to heirs and designated beneficiaries and any debt owed to creditors is paid off. In general, probate property is distributed according to the decedent’s last will and testament, if there is one, or according to state law if no will exists.

The process usually involves three steps:

1.  Collection of Assets which means you build a list of all the decedent’s assets and secure values on them to determine their estate.
2. Payment of Debts that often include bills from their last illness, funeral expenses, any creditors, taxes, and the expenses incurred by the administration of the estate.
3. Distribution of whatever is left to the heirs to the estate either according to the will or if there is no will, according to state law.

When is Probate Required?

Generally speaking, probate is only required when the person passes leaving a property in only their name or have right to receive property as in the case of a debt owed to the deceased.  But, not all property will be subject to probate.  Generally, there are 4 ways the property will pass to a new owner upon death without going through the probate process.

Joint Tenants with Right of Survivorship

Properties owned in this manner will pass automatically to the surviving joint owner without going through probate.  We often see that a husband and wife will own property in this way.  Or we see a single parent add children to the title of their property in this way during their estate planning process so that their child or children can avoid the probate process.

If you are not sure how the property is titled, you can consult with a local title company to make the determination.

Properties Owned by a Revocable Trust

We also talked to quite a few people who took the time to place all their assets, including their homes in a Revocable Trust.  These properties would not need to go through probate but instead would be disposed of under the written instructions in the trust document.

Who Inherits?

Generally, who inherits is decided by the will. But when there is no will, who gets what is decided by state law in the following manner?

Married with Children

Generally, most states will award a large portion of the estate to the surviving spouse and the remainder to the children.  And in the case of underage children, they would appoint a guardian for the children.

Married with No Children or Grandchildren.

In some states, everything will go to the surviving spouse and in other states, the parents of the deceased may get a share.

Single Person with Children

The estate would be divided equally among the children.  And if an adult child of the decedent has also passed, their share would then be divided by his or her children.

Single Person With No Children or Grandchildren.

In most states, the estate would go to parents and if there are no parents, then the estate would be divided among brothers and sisters.

Resources Consulted

• AARP
• Nolo Press

If selling you are selling an inherited property, we will be glad to answer your questions and to make you an all cash offer, closing quickly with you making no repairs.   

The post Inherited Property and the Probate Process appeared first on kcmohomebuyer.

A while back we shared an article about Probate. We talked about what it is and the basics of how it works in Kansas and Missouri and shared some links to a few additional resources. But people still had questions.

Can I Sell a House During Probate?

One of the big questions a lot of people have is about how to sell a house in probate and if it is possible to sell the house BEFORE the probate process is complete. Most people realize that proceeds from a sale sitting in a bank are way easier to keep track of and maintain than a vacant house that needs to be checked up on regularly and is racking up taxes, insurance, utility, mowing, and other bills every day.

Now we are not here to take the place of legal advice from a good attorney. We are simply providing some basic information so our sellers have a basic idea of their options when it comes to selling a house in the middle or after the probate process. And as all the legal advisors we have consulted tell us, every probate process is different and it could be as short as a couple of months and a more complicated estate may take a lot longer.

If you are considering selling a house during the probate process there are some basic steps to follow.

First: Hire a Probate Attorney

Before you do anything about selling the house in probate, hire an attorney to provide guidance and counsel through the probate and sale process. If it is a low-value house you may be able to sell it without a lot of hoops. And if it is a bit higher priced, you might have to do more. And some sellers need extra help from an attorney if for example there is a traditional mortgage or a reverse mortgage to deal with.

Second: Determine the Home’s Value

After consulting with an attorney and determining that selling the house or investment property right now is the best option, your next step is going to be to determine what the property is worth.

To find out value you may be able to hire a Realtor who knows the area to complete what they call a Comparative Market Analysis. As Realtors ourselves, we have done a few of these for small-value estates at the request of attorney friends. Other times you may want to hire an appraiser to determine value. You will want to determine if a CMA or an appraisal is required with the advice of your attorney and they may even have a person to recommend for this valuation.

Third: Get the Probate Court’s Permission

Armed with a valuation on the property, the next step is to get permission from the probate court. Depending on the type of estate in probate there are different forms and petitions. Consult with your attorney on the right form to be filed. Note that in some cases, the court may want you to already have a sale contract from a valid purchaser in place so steps 3 and step 4 in this guide may need to be flipped.

Fourth: Find a Buyer

There are many options for finding a buyer. You might list it for sale with a real estate agent, but a traditional buyer might not be overly excited to wait for you to then get through step # 5 – Approval. You might list it for Auction – but again, your end buyer may not be willing to wait for the necessary approval. However, if you were to reach out to a direct buyer, like kcmoHomeBuyer, we can write you a valid contract that you can present to the court for their approval, and in most cases, we will be willing to wait out the process.

Fifth: Get Approval for the Sale Contract from the Probate Court

Depending on the type of estate, the probate court may approve the contract you present them if it is roughly 75% or 3/4ths the value of the property as it was valued in the initial inventory. In other cases, the court may want to offer it up for auction to see if they might be able to get a higher value than what was in the initial contract. So you can see why most traditional buyers may not want to make an offer.

Finalize the Sale

If you can find a buyer that will offer a sufficient amount to satisfy the court, you can then proceed to closing.

Issues that May Come Up When Selling a House in Probate

1. Owe too Much: In some cases, there may be underlying debt on the property in the form of mortgages or other liens that exceed the value of the property, often in those cases, your attorney and the court may advise the property to be abandoned to foreclosure by the lien holders.
   
2. Contract Price Not High Enough: It may be that a buyer cannot be found at a high enough price to satisfy the court. In this case, you should seek the advice of your attorney who may advise you to just wait for the probate process to complete and then proceed with the sale.

If you have inherited property in the Kansas City Metro area and are seeking a valid buyer, the Tuckers here at kcmoHomeBuyer.com would love to work with you and your attorney. Please give us a call or submit your property information with one of the forms here on our website.

The post How to Sell A House During Probate appeared first on kcmohomebuyer.

While inheriting a home can be quite a roller coaster ride. On one hand, you are probably sad at the passing of the owner of the home. On the other hand, you might be overwhelmed with getting an extra house and all the stuff that goes along with it: mortgage, taxes, insurance, and upkeep. So you might consider selling and you might be wondering just what are the tax consequences when selling an inherited house. Just what are the tax laws and will they make a bitter-sweet inheritance a huge tax burden?

Tax Consequences When Selling an Inherited House

What is Your Tax Basis In the House?

When you inherit a house, the value of the property at the time of the previous owner’s passing becomes your “basis” for tax purposes. This initial value plays a significant role in determining the taxable gain (or loss) when you eventually sell the house. Two scenarios can occur:

a) Step-Up in Basis: If the house’s value increased before you inherited it, you’ll typically receive a “step-up” in basis. This means your new basis will be the property’s fair market value at the time of inheritance. A higher basis can be advantageous when calculating taxes upon the sale.

b) Step-Down in Basis: Conversely, if the property’s value decreased before inheritance, you may receive a “step-down” in basis. In this case, your basis will be the property’s lower fair market value at the time of inheritance.

Will the Home be a Primary Residence or an Investment Property?

How you use the inherited house can influence the tax consequences of its sale:

a) Primary Residence: If you decide to move into the inherited house and use it as your primary residence, it may qualify for a valuable tax exclusion. This means you could potentially exclude a portion of the home sale’s capital gains from your taxable income if specific ownership and use requirements are met.

b) Investment Property: If you choose not to reside in the inherited house and instead use it as a rental property or for investment purposes, it will be considered an investment property. In this case, you’ll face different tax implications when selling it.

Will You Have Short-Term vs. Long-Term Capital Gains:

The duration you hold the inherited house before selling it can impact the taxes you owe:

a) Short-Term Capital Gains: If you owned the house for one year or less before selling it, any profit from the sale would be classified as a short-term capital gain. Short-term gains are generally taxed at your regular income tax rate, which can be higher than long-term capital gains tax rates.

b) Long-Term Capital Gains: If you owned the house for more than one year before selling it, any profit would be considered a long-term capital gain. Long-term gains often benefit from preferential tax rates, which are generally lower than regular income tax rates.

Just keep in mind that your Capital Gains, short-term or long-term will be affected by your basis. The Price that you work from for a starting point is your basis, not the price your loved one paid for the house when they purchased it.

Tax Exemptions and Exclusions:

Several exemptions and exclusions could reduce or eliminate your tax burden when selling an inherited house:

a) Home Sale Exclusion: If the inherited house became your primary residence, you may qualify for the home sale exclusion. This allows you to exclude a portion of the capital gains from your taxable income, subject to specific criteria.

b) Estate Tax Exemption: Beneficiaries of an inherited house usually don’t have to worry about paying federal estate tax due to the estate tax exemption. The estate tax typically applies to the estate of the deceased, not the recipients.

Seek Professional Guidance

While this overview provides valuable insights into the tax consequences of selling an inherited house, tax laws can be complex and subject to change. While this overview provides valuable insights into the tax consequences of selling an inherited house, tax laws can be complex and subject to change. It’s wise to consult with a tax professional or financial advisor before making significant decisions. They can offer personalized advice based on your specific situation, ensuring you make well-informed choices. Plus we are not accountants or attorneys so it’s wise to consult with a tax professional or financial advisor before making significant decisions. They can offer personalized advice based on your specific situation, ensuring you make well-informed choices.

Having an inherited home can be stressful given the fact that you have new property to take care of and pay taxes for it at the same time… You should go through the probate process if needed as the first step to selling an inherited home. The court will then authorize you to proceed as you wish. If there are any other individuals involved in the inheritance, you should first agree with each other on that decision. You can then file a petition requesting the court to allow you to sell the property.

Ready to Sell The Inherited Home

After inheriting a property, individuals often contemplate various options. Some may choose to move into the house themselves, while others consider using it as a rental property. Another option is to sell the property, and even within this choice, there are further decisions to be made – selling it as is or renovating it before putting it on the market. All of these choices are valid and depend on personal circumstances. If you find yourself considering the renovation and selling route, we’d be delighted to have a conversation with you. Don’t hesitate to reach out. We can assess the property and present you with an as-is cash offer, an estimated sale price with minor improvements, and even a potential value after a complete renovation, particularly if the house or condo is a bit older, as is often the case with inherited properties.

The post Tax consequences when selling an inherited house appeared first on kcmohomebuyer.