Denise Knows Probate!
Selling an inherited home comes with a lot of responsibility. However, the probate sales process will go more smoothly and comfortably if you are prepared with the necessary information for any challenges that may come your way.
No doubt, North Carolina has its own procedures for selling an inherited property. Keep reading to find out things you should know before selling your inherited home in NC.
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Confirm you are the executor of the will.
The executor or the court appointed administrator is the only person who may legally sell an inherited property, if it has been included in probate. You don’t want to spend much time and energy getting the property ready for sale just to find out that the will and last testament names someone else as executor or beneficiary.
Thus, it is important that you find the decedent's will as quickly as possible. You may have to call the decedent's estate planning attorney if they used one or by searching through their possessions.
You may need to check in dresser drawers, closets, cabinets or check to see if he had a safe deposit box at the bank. Most likely it will be tucked away in a place that the decedent felt was safe.
Hopefully if there is a will, you will be able to locate it and identify if the decedent appointed an executor or not.
If the decedent did not appoint an executor the clerk of superior court will appoint an administrator to handle the probate process.
[Executor, administrator and personal representative all serve the same role. In the article we will use the term executor.]
Create an inventory list.
Another thing the executor will need to do is create an inventory list of all of the decedent's assets and debts. He will need to assign a value for each probate asset. If the decedent had debt that needs to be paid the assets may need to be sold to pay the debt, unless the family can afford to pay them and choose to do so.
If the assets alone does not have enough value to cover the debt, the executor can petition the clerk of court to obtain permission to sell the property. In North Carolina the property does not have to be included in probate, unless there is not enough funds to pay the decedent's creditors off.
If permission is granted by the court, the executor can have the house placed on the market.
Once the house is sold the money will go into an estate account and used to pay the decedent's debt. It is the responsibility of the appointed executor to pay each debt.
If there is no valid will, and there is money left over after paying the debt, the remaining funds will be distributed following North Carolina intestate succession regulations.
You need to come to an agreement with other heirs.
The fact that there may be multiple heirs with each having their own opinion about the property may cause a split amongst siblings. And sometimes other relatives can even further complicate the already difficult task of selling an inherited home by expressing their opinion.
Some heirs may want to live in the house and maintain it, while others want to sell it and divide the proceeds.
If everyone is not on one accord it can cause a delay with the probate proceedings. This is one of the things that may cause the closing to take months and sometimes even years before settling.
Therefore, it’s essential to communicate with your co-heirs. Talk to them calmly about the various solutions available. If you wish to sell but your co-beneficiary wants to keep the house, purchasing their part of the property might prevent a protracted legal struggle or you may need to petition the courts for a partition.
When you sell an inherited home, you will owe taxes.
Amongst other things, capital gains taxes would apply to selling an inherited home. You will pay taxes on the difference between the property’s worth at the time of the inheritance and the sale price.
Also, if you rented out the inherited home while you owned it, you may owe income taxes when you sell it.
Making an inherited home your principal residence for at least two years can help you save money on capital gains when you eventually decide to sell the property. It is best to speak with a probate attorney or probate accountant to get the facts on capital gains taxes.
Know the value and expenses of the home.
Before deciding to sell, you should be aware of the inherited home’s value. Get an expert inspector to go over the house for you. Investigate whether the house is in good shape or requires significant work to make it livable. In addition, you should talk to a real estate agent to get an idea of the current market worth.
If the home is included in probate it is important to get a real estate agent who is knowledgeable with the probate process.
You should also be prepared to have the house cleaned. You may need to hire a junk removal company or professional house cleaners. This will help the house to sell quicker if it is presented in good livable condition.
Also be prepared to hire someone to keep up the landscape and gardening while you wait for the house to be sold.
The executor will be responsible for keeping the utilities on, paying vacant insurance if no one is living in the house and keeping the grass cut. In North Carolina, some counties will fine you if the grass is starting to grow too long.
There are many other services that you may need to get the house ready to sell. Read our article called "24 Things you need to know about about selling a house in probate in NC". Yes, that is a long title but the article does cover other services that you truly may need before putting the house on the market.
Once the house has been sold, the decedent's debt has been paid there are still more steps to take before closing out probate. We will discuss those in another article.
North Carolina Probate Solutions
When you work with us, we provide an umbrella of services that you will need to get through the probate process. Our goal is to make it a seamless experience for you. If you have any questions or want to learn more feel free to contact us. We would love to share our expertise with you!
[Need help with probate? Join our Private Facebook group where you can ask questions and get answers, learn from others or share what you learned about the probate process. Be the first to join our new group! Join Here.]
Certified Probate Real Estate Specialist
Licensed Realtor
252-902-9006
* NOTE: North Carolina Probate Solutions and the author of this article is not a licensed attorney or CPA. This post should not be considered legal or tax advice. Always consult an estate attorney or tax professional when needing legal answers and legal advice.