What do I do when I inherit property with someone else?

Ralph Estep Jr.:
00:00

Have you recently inherited a property with a sibling or someone else, and you're wondering how to navigate this situation without causing conflict? You also want to ensure a fair outcome for both parties. Well, stay tuned because today, we're going to dive into the world of inherited properties, and we're going to learn how to manage that process efficiently.

Ralph Estep Jr.:
00:19

The truth is, inheriting a property can be both a blessing and a curse. On the one hand, you've received a valuable asset that could potentially change your financial situation for the better. On the other hand, sharing an inheritance with someone else can lead to disagreements.

Ralph Estep Jr.:
00:34

It can lead to misunderstandings and can even lead to legal battles. I've seen some of those, and they are not fun. As I've said many times, death can bring out the worst in people. But fear not because today, we're going to equip you with the tools and the knowledge you need to handle the situation with grace and wisdom.

Ralph Estep Jr.:
00:53

Welcome to the Ask Ralph Show where we explore the intersection of faith and finance. I'm your host, Ralph, and I'm thrilled to have you join me on this journey towards financial freedom and spiritual growth.

Ralph Estep Jr.:
01:07

Well, before we dive into today's topic, I want to take a moment to thank each and every one of you for listening and being a part of this great community we're building. Your support means the absolute world to me, and I'm honored to be able to share my knowledge and my experience with you today.

Ralph Estep Jr.:
01:23

If you missed yesterday's episode, we discussed the important topic of how far back the IRS can audit you. We covered the statute of limitations, talked about red flags that can trigger an audit, and steps you can take to minimize your risk. If you haven't had a chance to listen yet, I would highly recommend checking it out.

Ralph Estep Jr.:
01:39

And don't forget to tune in tomorrow. We're going to talk about safe deposit boxes, what to keep in them, and what not to keep in them. We'll discuss the pros and cons of using a safe deposit box, what items are best suited for this type of storage, and what alternatives you might want to consider. So you don't want to miss tomorrow's show.

Ralph Estep Jr.:
01:59

Well, before we get into the meat of today's topic, I'm going to share a relevant Bible verse with you. It comes to us from the book of Proverbs 15:1, and it says this: "A gentle answer turns away wrath, but a harsh word stirs up anger." Keep this in mind as we discuss navigating inherited properties with others. A genuine understanding approach can go a long way in preventing conflicts and fostering a positive outcome for everybody involved.

Ralph Estep Jr.:
02:27

The truth is, inheriting a property with someone else, such as a sibling, can be complex and emotionally charged. However, with the right approach and mindset, it's possible to manage the process efficiently and even avoid conflict. Yes, you heard me right—avoid those conflicts. So here are some steps you can take.

Ralph Estep Jr.:
02:48

Number one, you've got to communicate openly and honestly. The first and most important step is to have an open and honest conversation with your co-inheritor. Discuss your individual goals, talk about your concerns, and also list out any expectations regarding the property. This is a time to listen to each other and try to understand where the other person's coming from during this season of raw emotion. I know this may not be easy, so you have to measure your words and your responses carefully.

Ralph Estep Jr.:
03:19

Well, number two, and this one is very important: seek legal advice. I can't stress this enough. Consult with an experienced estate attorney who can guide you through the legal aspects of the inheritance process. They can help you understand your rights as well as your obligations and provide advice on how to proceed. I am always amazed at how many people get themselves into major—I'm talking about big—problems because they just weren't willing to spend a few dollars on hiring a professional.

Ralph Estep Jr.:
03:48

Number three, get the property appraised. Have a professional appraiser assess the value of the property. This will give you a clearer understanding of what the property is worth and can help inform your decisions moving forward. This appraisal should be done as soon as possible after the person's passing due to the tax consequences and possible disinheritance. Trust me, I have seen too many situations where this step was overlooked, and it triggered some really negative tax issues later in the process.

Ralph Estep Jr.:
04:16

Let's move on to number four, and that's to consider your options. The truth is there are several options available when it comes to managing an inherited property with someone else. You could choose to sell the property and split the proceeds. You might have a situation where one party buys out the other share. You could choose to rent out the property and share the income. You might try to live in the property together—if that's feasible, I'd be really careful with that one. Or you could even divide the property if it's possible. The key is to discuss these options with your co-inheritor and determine which one aligns best with both of your goals and circumstances.

Ralph Estep Jr.:
04:56

Number five, put everything in writing. You say that again? Put everything in writing. Once you've decided on a course of action, make sure to put everything in writing. You will definitely appreciate this step down the road. This could be in the form of a legal agreement or even a simple written understanding between the parties.

Ralph Estep Jr.:
05:13

Having a written record of your decisions can help you prevent misunderstandings, and it may provide clarity if issues arise in the future. I wish I could say that issues never arise, but I've seen way too many cases where everyone thought they were all on the same page, then, well, not so much later on.

Ralph Estep Jr.:
05:31

Number six, be willing to compromise. Inheriting a property with someone else requires compromise. Be willing to meet in the middle and find solutions that work for all parties. Remember, the goal is to maintain a positive relationship and achieve a fair outcome for everybody involved. I know this may not always be possible—if you met some of my family, you'd understand why—but I guess that should be the goal.

Ralph Estep Jr.:
05:56

Number seven, try to keep your emotions in check. It's hard. Dealing with an inheritance can be an emotionally charged process, especially when it involves a loved one's passing. Try to keep your emotions in check and approach the situation with a clear head. If tensions rise, take a step back and remember the importance of maintaining family harmony. Again, I understand this may be easier said than done, but we can at least try, right?

Ralph Estep Jr.:
06:22

And number eight, seek mediation if necessary. If you and your co-inheritor are unable to reach an agreement or find yourselves in a dispute, consider seeking the help of a professional mediator. A mediator can provide an unbiased perspective and help you find common ground. I would certainly recommend reaching out for this type of help well before the process unravels—you don't want to wait till it's an hour of back and forth with each other.

Ralph Estep Jr.:
06:46

So you may want to include that discussion and mediation right at the start of the process. I just think that's a good idea. Remember, inheriting a property with someone else is a journey that requires patience, understanding, and a willingness to work together. By following these steps and keeping an open mind, you can navigate this process successfully and maybe even strengthen your relationship with your co-inheritor along the way.

Ralph Estep Jr.:
07:12

Well, let's do a quick recap. Today, we discussed the complex topic of inheriting a property with someone else and how to manage that process efficiently while truly trying to avoid conflicts. We covered the importance of open communication, seeking legal advice, considering your options, and being willing to compromise. Remember, the key is to approach the situation with a clear head and focus on maintaining positive relationships.

Ralph Estep Jr.:
07:40

Well, if you found today's episode helpful, I encourage you to visit our website at AskRalphPodcast.com and join our email list. By signing up, you'll receive exclusive content, updates on upcoming episodes, and valuable resources to help you on your financial and spiritual journey. And as a special gift for joining our email list, you'll receive a free copy of my book, "Mastering Your Finances."

Ralph Estep Jr.:
08:05

And if you know someone who could benefit from this information, please do me a huge favor and share this episode with them. Together, we can help others navigate the challenges of managing inherited properties and achieving financial freedom. If you find yourself in a situation where you've inherited a property with someone else, here are some actionable steps you can take right away.

Ralph Estep Jr.:
08:25

Number one, schedule time to sit down with your co-inheritor and have an open, honest conversation about your goals and expectations. Number two, research estate attorneys in your area and schedule a consultation to discuss your legal options and obligations—that would be things you need to do right away. Number three, start gathering necessary documents such as the will, trust documents, and property deeds. And number four, consider the various options available for managing the property and make a list of pros and cons for each.

Ralph Estep Jr.:
08:57

Well, thank you so much for joining me today. Remember, navigating an inherited property with someone else can be challenging, but with the right approach and mindset, you can turn it into a positive experience. I really believe that. Well, stay financially savvy and God bless you today.