Was There A Will?
The first step is always to determine whether or not the deceased created a will. This document will help you determine if there are any additional attributed parties for the property. A will may also contain guidelines regarding how the estate is to be maintained or split among more than one party. With the help of a will, you will be able to quickly connect with additional listed parties and begin the probate process.
It may be the case that that there is no identified will left by the deceased. If so, then you will need to find a reputable solicitor who has experience handling similar probate cases. The existence of a will does not impact whether probate will be needed for the property. In the UK, probate is always mandatory whenever a property has a value higher than £50,000. These probate laws exist due to banking regulations that prevent the release of funds beyond a specified limit.
Begin The Probate Process
In simple terms, the probate process is when the deceased’s assets are calculated, catalogued, and distributed. This process is necessary to facilitate the smooth transition of assets to the various inheritors. It provides a person or persons with ownership of the assets so that they can be properly distributed. The people who gain authority and facilitate the transition of assets are called executors.
The probate process is always easier when you are a listed beneficiary within the will of the deceased. A beneficiary is an individual who will be provided with a share of an estate from the individual who ultimately inherits the assets.
There are some requirements you must meet before you are able to sell a property that you have inherited. For example, you are required to establish your legal relationship with the estate. You can learn more about this process by discussing your options with a reputable solicitor who has experience handling these types of cases. More specifically, you want to work with a lawyer who specializes in wills and probate.
Some very specific cases may not require the full probate process. If the deceased had joint ownership of assets with a surviving party, then the survivor will naturally gain full ownership of the assets following their death.
When it comes time to sell an inherited property you will need to take the initiative and contact any organizations, such as mortgage companies, who are in control of the assets. Each organization will have its own rules in place for selling assets.
How to Sell The Newly Inherited Property
You have more than one option at your disposal when it comes to selling an inherited property. Some of these options have unique strengths and weaknesses.
- Traditional Real Estate Market
This is considered the safest and most reliable option. You are more likely to get a decent value for your property. You aren’t required to have a personal understanding of the local real estate marketing or the procedures involved with listing a property. Online estate agents should also be considered in this instance.
The traditional method is one of the slowest when it comes to selling an inherited property. It may take anywhere between 3 and 9 months for a listed property to sell. You may also be required to sign a lengthy listing contract.
- Selling Through An Auction House
You have control over the minimum amount that the property can sell for. It’s possible to close a deal in as few as 28 days after making the sale.
You do not have full control over the final price of the deal. Depending on your timing, you may have to wait up to 3 months for an available auction date to be available. It’s entirely possible that the property will not sell during its first listing.
- Property Investment Company
Strengths: The potential for the quickest turn-around time with some deals closing in less than a month. Sales are generally made as cash offers with no mortgage fees involved. There are no solicitor fees required from the seller.
Weakness: There are none.
You May Need To Pay An Inheritance Tax
In many cases, you may be required to pay an inheritance tax after selling the property. To determine if and how much is required you can use online tools like a free HMRC calculator. A slightly more reliable option is to discuss the tax with your preferred accountant.
You May Need To Pay A Tax For Capital Gains
In addition to inheritance taxes, you may also be required to pay a small capital gains tax. Regulations in the UK provided by the HMRC require that all capital gains tax returns are reported shortly after you sell a property. You have a timeline of exactly 30 days following the sale to report your tax returns. Missing this deadline will add additional fees and interest to the required payment. Be sure to promptly pay these taxes as soon as the sale has been finalized.
You May Need To Pay An Income Tax
There are also some instances where you will be required to pay an additional income tax. This is only applicable if you have used the inherited property to generate revenue during your ownership. For example, if you rented the property to tenants prior to selling, then you will be required to pay this tax. If you did not generate revenue from the property, then there is no need to worry about an income tax payment.
A Simple Guide To Selling Your Inherited Property
The first stages are always the most tedious. You’ll need to work closely with solicitors to determine if you have fully inherited the property or a particular share of the estate. Once you have managed these steps you can move forward with determining how you want to sell the property. Most people who inherit properties are interested in selling the home quickly for a fair amount.
Selling a house quickly through the traditional market can be troublesome if the home has not been fully modernized. Today’s buyers will expect the seller to update the property to modern standards before listing. You can take the time to renovate the property, but that can easily take months of time and cost well above £30,000.
The question now becomes whether or not you are willing to wait that long and have that much money to spare. If not, then a faster, more efficient alternative will be to use a registered property buying company. They will make a fair cash offer for your home in its current condition. You’ll save money and have more time to focus on other aspects of your life.