As of this time last year, a majority of homes in the United States (about 54%) were owned by those 55 years old and older. That’s a lot of homes with owners who will likely pass away sooner rather than later (at least when compared to homeowners belonging to younger generations). When a homeowner passes away, their home may go into probate. From there, there are three common outcomes for that house.
Inherited by a Sole Beneficiary
A single beneficiary may inherit a house in probate. This may happen if the house is left to one person in a will. In some cases, a spouse’s name may also be on the deed, in which case the house will likely pass to that person. Some state laws may also influence how a house is inherited by a sole beneficiary. An estate lawyer can help those involved understand how all of that works.
Inherited by Multiple Beneficiaries
In other instances, a house may be left to multiple beneficiaries. This is most likely to happen when the deceased has multiple descendants that they wish to benefit from the property. In such a case, it is often best for the house to be sold and the profits distributed amongst the beneficiaries. This is far simpler and much easier than getting everyone to agree on what should be done with the house and how to make it happen.
Sold to Pay Off Estate Debts
When someone passes away with outstanding debts, their estate becomes liable for settling those debts. Assets and investments, including real estate, may be used to pay off debts postmortem. Because houses are usually the most valuable asset or possession that anyone has, they may be a viable debt-resolution solution. Once the debts have been settled, beneficiaries can inherit as directed by the deceased’s will or through the instructions of the probate court.
Probate can be a ponderous process, but it’s an important one, especially if there wasn’t a will left behind by the deceased. In these cases, the probate court acts in the best interests of the deceased. Of course, there are ways around a house going into probate, but that requires antemortem estate planning that not everyone gets done before passing on. For those who have interests in a house going through probate, understanding the potential outcomes can make navigating the process easier to deal with.
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