Usually, inheriting real estate is a good thing. However, in today’s real estate market many homes are underwater. That means there is more debt on the home than there is equity in the home. If you inherit an underwater home, it is important that you speak to a Probate lawyer right away.
Should you choose to do nothing and inherit the property, it is likely that you will also be inheriting the debt. Obviously, leaving you with debt was not the deceased’s intent, but the possibility is a fact of life today. If you do not want to inherit the debt with the property, then you should disclaim the property in Probate Court. Disclaiming is the legal way to state that you do not want the property and refuse the inheritance. You often have a limited time to disclaim property and you must do so before you take any of the benefits of inheriting the property.
You might have sentimental or other reasons for wanting to inherit an underwater home. However, most people do not want to inherit anyone else’s debts. If you have concerns about inheriting debt, speak to an experienced Probate attorney about what you can do to protect your financial interests.
Stephen A. Mendel, Estate Planning Attorney
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