When inheriting property, you may be collecting more than you think.
So you’ve inherited property — now what? Even if your inheritance isn’t in a legally binding trust or will, you may have to go through the process of clearing the title of any inherited property through probate.
Probate is the process of gathering all of a decedent’s assets and appropriately distributing them among inheritors and creditors.
In most cases, there are four steps in the probate process:
- File a court petition, and give notice to any other beneficiaries
- Alert all known creditors of the estate once a court date is set and take inventory of the property
- After the probate hearing, in which the distribution of assets has been determined, pay off all estate and funeral expenses as well as debts and taxes
- Inheritors gain legal ownership of the property or properties
When you’ve inherited property that ends up in probate, don’t assume that it will be a simple or short process. Here are some things to consider if you find yourself in a probate trial or before you choose to file for probate.
When inherited property ends up in probate, you might be in for a wait — and unforeseen expenses — before you can fully claim the property. The state in which you live, the value of the inheritance, and when you file will affect the final outcome.
Probate 101
The state in which probate takes place can have an enormous impact upon the length of time—from weeks to years—in which the estate will be settled, as well as the costs.
Potential probate expenses:
- Appraisals
- Court fees
- Bond fees
- Attorney fees
- Personal representative fees
- Valuation fees
- Accounting fees
The Necessity of Appraisals
In probate, nonliquid assets must be appraised to determine their worth.
Real property, including:
- Land
- Homes
- Commercial property
- Crops
- Machinery
Personal property, including:
- Jewelry
- Vehicles
- Art
- Livestock
- Boats
Average cost of a home appraisal is between $300 to $400
- National average: $326
- High: $450
- Low: $225
The Cost of Going to Court
Many states require a statutory attorney, who may charge by the hour, a flat fee, or a percentage of the gross estate value, which may not include court fees. These can run tens and even hundreds of thousands of dollars with extremely large estates. Court fees can range from $215 to $3,000.
Inheriting real estate can be complicated, but navigating probate doesn’t have to be. Don’t let legal issues and extensive fees delay claiming your inheritance.
