Understand how Inherited Property is transferred to Beneficiaries?
June 4, 2020
Over the last few months life has changed significantly. If you have inherited a property during this time or making preparations, you may be facing tremendous stress. Knowing the most common, reliable, and powerful ways to transfer or receive a piece of inherited property is hugely important when it comes to expediting the process when the times come. Wills and Trusts Below are two of the more common estate planning tools, however given the current circumstances it is essential to understand the probate process incase no estate planning was done in advance.
The person named as the recipient of property through a will is often called a “beneficiary”. If you’ve been named as a beneficiary of property you may be left liable for the mortgage payments, taxes, and outstanding liens on title for the property received. The first thing to do as a beneficiary as reach out to a local real estate attorney as there are several legal items that likely need to be done prior to even thinking about renting the property or putting the home on the market. In an event of absence of a will the courts will need to facilitate a fair distribution of the assets and this could be time consuming, expensive and strain relationships. Also, even if a will is present, the asset distribution has to go through a court system.
Trusts
A Trust is a vehicle to transfer title to a surviving family member. It bestows a legal obligation on a third party (called a “Trustee”) to hold the assets for benefit of another person (heir) called the beneficiary. One can sign an agreement to move a property into a trust thus allowing it to transfer upon death of the owner. The trustor (the person who originates the Trust and has control) directs the passing of assets to trustee per the instructions outlined in the Trust. If you’ve inherited a piece of real estate via a Trust, you may need to work with the trustee to get it sold.
No Trust or will made?
Wills and Trusts are common vehicles for estate planning, however they are not the only ones. Joint ownership, tenants in common or a transfer on death deed just to name a few are other means of working out an inheritance. If any and all of these options were not planned for or set up in advance the property will likely go to Probate Court.
We can help expedite the process of selling your inherited property by submitting a cash, as-Is offer for the property.
How much does Probate cost?
Probate is the least ideal of all scenarios in-terms of time, cost and privacy. If there is no estate planning, will or trust in place for distribution of assets among the heirs, then the property will be subject to probate proceedings.
Time– Probate process is subject to state guidelines and laws. If you have any experience dealing with the court system you know that they do no function at an ideal pace. The situation is only magnified when it comes to assigning ownership to real estate. It can take several months to several years to sort out depending on the asset and family.
Money –The cost associated with a probate property involves personal representative’s fee, attorney fees, court fees and potentially fees for an appraisal and accountant. To determine the rightful beneficiary the court has to expend resources. These costs add up quickly!
Privacy – In addition to time and cost, your family’s privacy could be at stake. While Trusts keep information about family members private and off public records, probate involves the recording of court docs for public access. There could be extremely sensitive and private information such as who is involved, how much money is in the estate, what types of property are in question.
Inheriting a property is challenging because of some reasons outlined above. The good news is that we can help by submitting a cash, As-Is offer for the property that puts you and your family in a better position to sell the property quickly with less headaches. Reach out to us today to see how we can help!
