An inherited house may still have a mortgage, HELOC or other debt. The loan does not simply disappear because the original borrower died.
Find the latest mortgage statement and determine whether payments, property taxes and insurance are current. Ask the servicer and estate attorney what procedures apply to the estate.
If the property will be sold, the loan payoff is normally one of the major numbers in the closing calculation. If an heir wants to keep the property, the attorney and mortgage professional should explain the available options and requirements.
Do not rely on a family member’s estimate of the balance. Obtain current written figures and identify any secondary liens.
A broker can estimate market value so the family can understand the relationship between the property’s value and its debt. The attorney and lender should answer legal and loan-specific questions.
Knowing the debt early can prevent an heir from assuming the estate has more equity than it actually does.
If you inherited a residential property in New York or New Jersey and are unsure what to do next, Citi Living Solutions can help you understand the local market, property value, buyer options and sale process. Legal and tax questions should be handled by the appropriate professionals.
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