What estate planners need to know about their homes

What estate planners need to know about their homes

For most North Carolina families, deciding what happens to a home after the original owner dies becomes the most complicated part of the estate planning process. The amount of money a home is worth, along with the attachment family members will develop to a family home, makes it necessary to use a specific strategy when determining an heir. It helps to understand a few points before devising this strategy.

Planning is easier when everyone provides input

Individuals deciding how their homes fit into their estate plans should start by asking themselves what they would like to happen with their houses after they are gone. Once determining their own goals for their homes, it is time to speak with children and any other family members involved with the process. Different opinions may exist regarding what to do with a home, so it is important to allow everyone to voice his or her thoughts and feelings on the matter.

Financial impact to heirs

When the person who inherits the home decides not to use it as his or her residence, taxes and legal fees can become attached to the inheritance. Heirs that do not possess the resources to pay an estate tax bill will then need to either sell the home or seek money to pay the bill. If the heir decides to sell the home, taxes are assessed according to the property’s value when the original owner died.

Mortgage may become due

Many mortgages become due when the owner passes. When this is the case, heirs will need to either find the money to pay the balance owed on the home, qualify for their own mortgage or make the house available for purchase.

Leaving a house to a loved one as part of the estate planning process can become more complicated than many people understand. This is due to the many factors that affect the transfer of a home as an asset. Individuals with questions about leaving their homes to loved ones may wish to consult with an attorney who is experienced with the estate planning process.

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