DISCLAIMER: This blog post is meant to be used for educational purposes only, not legal or financial advice. If you need assistance navigating the legalities or tax implications of selling an inherited home in Texas, HomeLight always encourages you to consult a professional advisor.
Inheriting a house can be an incredible gift, but it comes with great responsibility. If you are considering selling an inherited house in Texas, you’ll need a short-term plan to arrange for maintenance and upkeep, as well as professional guidance to help you maneuver the legalities and grapple with the financial aspects.
This article offers expert insight from Gina Candelario, a top agent who works with 78% more single-family homes than the average San Antonio, Texas, agent, and Brent Morgan, a Texas probate attorney, to set you on the path to a successful sale of your inherited house in Texas.
12 steps to selling an inherited house in Texas
Inheriting a house comes with baggage, both literally and of the emotional variety. Making decisions at this time can be particularly challenging. These steps are intended as a starting point if you’re operating on automatic pilot during a difficult time and don’t know where to turn for information on selling an inherited home in Texas.
Unless the house you inherited was part of a trust, it has to go through probate. If the home is owned by a trust, the named trustee must follow the dictated terms of the trust. If the home is not part of the trust, you must file an application or petition for probate with the appropriate county clerk’s office.
Here are some of the other steps you’ll want to take:
1. File the will
The first thing you’ll need to do is find out if there’s a will. As Morgan states, “That dictates who the executor is.” A judge must approve that the named executor and the will are valid, Morgan explains. If no executor was named, the judge will determine the heirs.
You may want to hire a probate attorney to help guide you. “There’s a fine line between legal advice and real estate advice,” Candelario cautions.
2. Coordinate with all heirs to nominate a personal representative
If there’s no will, Morgan says you can avoid probate by filing an affidavit of heirship, which requires two unrelated people to identify you as an heir. This can allow you to transfer title.
3. Transfer title
You’ll need to transfer title of the property into the names of the inheritors, Morgan advises. He suggests calling a title company rather than an attorney to accomplish this.
This step is important. Candelario relates the story of one of her clients who was one of five inheritors of his uncle’s estate. When they tried to put the home on the market, they weren’t able to use the tax records that were still in the uncle’s name since the uncle was unable to sign.
4. Pay debts
Before anyone inherits anything, you’ll need to determine the property’s financial situation: Is there a mortgage? “Some mortgages have an acceleration clause that would demand immediate payoff,” Morgan says. A home equity line of credit (HELOC)? A reverse mortgage? Are there any liens or judgments? Unpaid taxes?
You may also need to pay the medical and funeral expenses of the deceased.
A title search can provide many of those answers, but you’ll also want to know the value of the home. HomeLight’s online home value estimator can provide a preliminary estimate of your inherited Texas home’s worth. You can also see our guide to finding the value of a house.
5. Open an estate account to manage shared assets
One of the first duties the personal representative should perform is to open an estate account. This bank account is where the assets of the deceased (including proceeds from the home’s sale) will be temporarily stored. The rep will use funds in the account to pay any expenses or financial obligations of the deceased, such as mortgage payments, property taxes, utilities, and HOA fees.
6. Gather important documents
If you share this inheritance with others, you’ll also need sign-off documents stating that they agree to the sale.
7. Understand timelines
Be prepared for the process to take time, especially if the property has to go through probate, which can add months to your schedule.
“From the date you discover the need to probate, you have four years to probate the will or bring the case to probate,” Morgan states.
8. Enlist the help of a mediator if needed
If your co-inheritors disagree about the sale, the price, or the distribution of belongings, you may need the help of a mediator. This can add to the timeline (and hard feelings) and diminish financial reserves.
9. Discard, donate, or sell unwanted items
Not all the items owned by the deceased will have value to the inheritors, so decisions on how to distribute them must be made. If the will doesn’t dictate what’s to become of the person’s possessions, you’ll have to decide what to do with them.
Candelario suggests creating three piles: divide amongst the inheritors; sell valuable items at an auction or estate sale; donate useful items; and discard everything else. One benefit of an estate sale, she adds, is that it draws a lot of people to see the property.
Consider appraising jewelry and antiques.
10. Deep clean and complete needed repairs
The rep can use money in the estate account to make some improvements to the house before listing it for sale. Decluttering and a deep clean can increase the sale price by 3% to 5%, so it’s worth investing a little to clean and complete minor repairs.
Don’t do much, Candelario cautions. “Deep clean and do basic lawn maintenance, like adding mulch.”
11. Partner with a top agent with probate experience
A top agent with probate experience can help guide you through the process. They know the Texas Estates Code and that Texas law permits up to four years for probate before the laws of intestacy determine how the deceased’s assets will be distributed. In addition to the typical listing duties, an agent can help submit a bid to the probate court for approval and ensure co-inheritors sign waivers.
12. Or, consider selling the inherited house for cash
If a lengthy sales process sounds too emotionally draining and you’d rather sell your inherited Texas home quickly, you may prefer to sell it to a cash buyer. Keep in mind that you might make less money, but know that the process can be less stressful than putting the house on the market.
With HomeLight’s Simple Sale, you can skip the repairs, staging, open houses, and showings. There’s no obligation, and you can get an all-cash offer as quickly as 48 hours and close as soon as 10 days after accepting the offer.
What are your options to sell an inherited home in Texas?
The main options to sell an inherited house in Texas include:
List with the help of a real estate agent
The benefits of using a top agent include getting a higher price for your home, in part because real estate agents have access to a larger buyer pool through the multiple listing service (MLS) and in part because they know how to price it right. An agent can market your property, suggest resources for repairs or staging, negotiate offers, and offer other assistance throughout the process of listing and selling a home.
Sell directly to a cash buyer
Another selling option is to work directly with a property investor or house-buying company rather than list the property with an agent. These companies can help sellers cash out quickly and many will cover a seller’s closing costs.
There are three common types of all-cash buyers:
- House flippers: These ‘We Buy Houses’ operations are investors that purchase properties at a discount and generally seek out homes in need of significant repairs. Their goal is to remodel to add value, then resell quickly for a profit. Selling to a “We Buy Houses for cash” company usually means accepting a lower offer.
- Buy-and-hold companies: These companies purchase houses with the intention of renting them to tenants for a profit. Similar to house flippers, they will look to acquire properties that offer enough potential equity that they are able to make an acceptable return on their investment. Here again, expect to receive a lower purchase price compared to selling on the open market with an experienced agent.
- iBuyers: An iBuyer, or instant buyer, is a business that uses real estate market data and technology to make cash offers on houses. Most iBuyers focus on buying houses that don’t need a lot of work and often charge a service fee to sellers. Because the homes they agree to buy are usually in better condition, iBuyers typically provide higher cash offers than flippers and buy-and-hold investors.
For any of these selling options, it’s important to vet the company and read the buying agreement carefully before signing.
Sell as ‘for sale by owner’ (FSBO)
You can skip the agent and try to sell the house yourself, but for sale by owner (FSBO) often takes longer and nets less money, so you’ll have to decide if it’s worth it. If you’re not familiar with disclosures, are uncomfortable with negotiations, and don’t know much about escrow, you might want a professional on your side – especially because a professional real estate agent can list your home on the multiple listing service (MLS), the database of homes other agents access to help clients buy and sell homes.
FSBO can be challenging at any time, but maybe even more so during bereavement or if you don’t live in the same Texas town as your inherited house.
How can I sell an inherited home quickly and easily?
With an inherited house, sometimes the goal is to sell it quickly and move on. Selling directly to a cash buyer may be a good solution if convenience and speed are a priority because you can skip repairs and showings and still get a fair offer.
If you want an idea of what you might receive for a cash offer, consider Simple Sale, a solution from HomeLight. With Simple Sale, you answer a few questions about the inherited house. From there, we’ll provide you with a no-obligation full-cash offer to buy the home in as few as 48 hours.
Skip repairs: HomeLight will provide an offer for homes in almost any condition.
Sell when it’s convenient: The Simple Sale process is flexible. In most cases, you can pick a closing date that works for your schedule.
Close with certainty: Cash buyers don’t need a lender’s involvement to purchase a home, meaning they can move nimbly and quickly compared to someone who needs financing. With Simple Sale, you can close in as little as 10 days.
Does Texas have an inheritance tax?
Texas does not have a state inheritance or estate tax, sometimes colloquially referred to as the “death tax.” (Texas repealed its inheritance tax in 2015.) However, you may have to pay federal estate taxes.
When is the best time to sell a house in Texas?
The best time to sell a house in Texas is from February to June, according to Candelario, although it can depend on your city. After Labor Day until early December can also be good. Check out HomeLight’s Best Time To Sell Calculator to learn the best and worst months to sell a home in any Texas city.
What should you not fix when selling an inherited house in Texas?
Candelario says “don’t fix anything” when selling an inherited house. You may feel the need to address some home repairs before listing the house, but don’t fix these things:
- Cosmetic flaws
- Minor electrical issues
- Driveway or walkway cracks
- Grandfathered-in building code issues
- Partial room upgrades
- Removable items
- Old appliances
Ready to sell your inherited house in Texas?
If you inherit a Texas home you’re considering selling, be sure to locate the will and file it in probate court before doing anything else. You’ll need to set up an account to cover expenses until the home sells and to cover any debts. You’ll also need to prepare it for sale by clearing it out and cleaning it up.
Whether you choose to list your inherited home with a real estate agent or request a no-obligation cash offer, you now know what to expect to get the home sold. Whenever you’re ready to take the next step, HomeLight would be happy to assist with your real estate needs. Connect with a top agent near you or get started with a cash offer from Simple Sale.
Header Image Source: (Roger Starnes Sr / Unsplash)
- "How to Set up an Estate Account," Policygenius (December 2021)
- "What Is a Living Trust?," LegalZoom (July 2022)
- "Should You Hire An Appraiser Before An Estate Sale," Jerry's Antiques & Estates (May 2022)
- "Ultimate Texas Probate Guide," Forbes & Forbes Law (December 2018)
- "How Much is Inheritance Tax in Texas? Complete Guide," Thomas Walters PLLC (March 2022)