Selling an Inherited House in Michigan: What You Need to Know

Coping with Loss and What Comes Next

Losing a loved one is hard enough. Inheriting their home on top of that can feel like too much — especially when you're still grieving, managing family expectations, and trying to understand legal and financial responsibilities.

You might be wondering:

What happens now that I own this property?
Do I need to go through probate?
Will I owe taxes if I sell the house?
How do I handle this with my siblings?

You're not alone. Many Michigan families find themselves in the same place — overwhelmed, unsure, and stuck between honoring someone’s memory and figuring out what to do with their real estate. Whether the house is in good shape or falling apart, whether you live nearby or out of state, one thing is clear: you need clarity and a plan.

This guide will walk you through every step of the process — from understanding probate to exploring your options for selling. It’s designed specifically for Michigan residents, so you’ll get localized insights that apply to your situation, not just general advice.

Take a breath. You’re in the right place to start making informed, confident decisions.

What Happens When You Inherit a House in Michigan?

Inheriting a home might seem simple on the surface — someone passes away, and their house becomes yours. But in Michigan, it’s rarely that straightforward. The first step is understanding how the property was passed down and what your role is in the process.

Here are the most common scenarios:

🏠 The house was left to you in a will

If the deceased left a valid will naming you as the heir, the property typically goes through probate — a legal process where the court reviews the will and authorizes the executor to distribute assets. Once approved, the executor can legally transfer the title to you or sell the property on behalf of the estate.

📜 There was no will (intestate inheritance)

If there’s no will, Michigan’s intestate succession laws decide who inherits the home — usually the spouse, children, or closest relatives. The probate court will still need to approve the distribution, and someone (usually a family member) will be appointed as the estate’s personal representative.

👥 You inherited the house with siblings or others

In many cases, multiple heirs inherit the property together. That means decisions like repairs, renting, or selling must be made jointly. If you’re in this situation, it’s crucial to maintain open communication and set clear expectations early — especially if not everyone agrees on what to do next.

🧾 You’re the executor or personal representative

If you were named in the will (or by the court) as the person responsible for managing the estate, your job is to protect the property, handle debts, and eventually distribute or sell the home. You may not be the heir, but you have the legal authority to act on the estate’s behalf.

In any of these cases, you’re now faced with a mix of emotional decisions and legal responsibilities. The good news is that once you understand how the inheritance was structured, you can take the next step with clarity — whether that means settling the estate, preparing the home for sale, or exploring other options.

Understanding the Michigan Probate Process

Before you can sell an inherited house in Michigan, the property usually has to pass through probate — the legal process where a court validates the will (if there is one), settles debts, and authorizes the transfer or sale of assets like real estate.

That might sound intimidating, but don’t worry — probate doesn’t always mean a long, expensive ordeal. Here’s what to expect:

🔹 When probate is required

If the property was owned solely by the deceased and not held in a trust or joint tenancy, it typically must go through probate. This applies even if there’s a will. The court needs to officially transfer the title before it can be sold or inherited.

🔹 When probate might not be needed

Michigan offers simplified probate options for smaller estates. If the total value of the estate (excluding liens and mortgages) is under a certain threshold — currently $27,000 — it may qualify for a streamlined process using an affidavit of small estate. Property held in a living trust or jointly with right of survivorship may also bypass probate.

🔹 What the process looks like

Probate usually starts with filing a petition at the county probate court where the deceased lived. The court appoints a personal representative (often a family member or named executor), who then gathers assets, pays debts, and distributes what’s left — including the home.

If the house needs to be sold, the personal representative has legal authority to list and close the sale, even before title is fully transferred to the heirs.

For a deeper dive into how probate works and what steps are required, visit our full guide on how to sell a house in probate in Michigan.

Do You Have to Pay Taxes When You Sell an Inherited House in Michigan?

One of the most common questions people have is whether they’ll owe taxes after selling an inherited home. The answer depends on how much the house was worth when you inherited it — and how much it sells for later.

Here’s what you need to know:

📈 Capital Gains Tax and the “Step-Up” in Basis

When you inherit a house, the IRS doesn’t use the original purchase price to determine your taxable gain. Instead, you get what’s called a “step-up in basis.” This means the value of the home resets to its fair market value on the date of death.

So, if your parents bought the home decades ago for $50,000, but it was worth $180,000 when you inherited it, your taxable gain is only calculated from that $180,000 figure — not the original price.

If you sell the house shortly after inheriting it for about the same value, there may be little to no capital gains tax due.

💰 Federal vs. Michigan Taxes

Capital gains are generally handled at the federal level. Michigan does not have a separate state-level inheritance taxfor properties inherited after 1993. However, any gain you realize on the sale of the home may be subject to Michigan’s state income tax, depending on your overall tax situation.

🧾 When You Might Owe

You could owe capital gains tax if:

The home significantly increased in value after you inherited it
You rent the home and later sell it at a profit
You make substantial improvements and sell for a higher amount

For a detailed breakdown and examples, visit our page on capital gains tax on inherited property in Michigan.

Are You Trying to Understand Your Options?

Talk to Dennis Now – (734) 224-5977

What If the Inherited House Is in Bad Shape or Still Occupied?

Inheriting a house can feel like a gift — until you walk inside and realize what you’re really dealing with. Many homes passed down through generations haven’t been updated in decades. Some may even be damaged, neglected, or filled with personal belongings. Others might still have tenants or relatives living inside.

These situations are more common than you think — and they can delay or complicate a sale unless you know how to handle them.

🧱 Major Repairs or Unsafe Conditions

Mold, roof leaks, structural issues, or fire damage can make the house unsellable on the open market without significant investment. You may not have the time, money, or desire to renovate — and that’s okay. Selling as-is to a local cash buyer can be a faster, simpler route, especially if you just want to move on.

🚫 Code Violations and City Fines

If the house has been sitting vacant, it may have racked up code violations — tall grass, broken windows, or structural hazards. Some Michigan cities fine property owners for these issues, and the estate may already be receiving warnings or tickets.

You don’t need to panic. These fines can often be negotiated or cleared at closing if you sell to a buyer experienced in code-violation properties.

👥 What If Someone Still Lives There?

Sometimes, inherited homes are still occupied — by a tenant with a lease, a family member with nowhere else to go, or someone living there informally. This can complicate the timeline and legal process for selling.

Before making any decisions, it’s smart to understand your rights and obligations. For a full breakdown, see our guide on how to sell an inherited house in poor condition in Michigan.

How Long Do You Have to Sell an Inherited House in Michigan?

There’s no single deadline that applies to every inherited property — but there are time-sensitive factors that can affect how and when you sell.

Let’s walk through the most common ones:

⏳ There’s No Legal “Sell-By” Deadline — But Probate May Set the Pace

Michigan doesn’t require heirs to sell an inherited house within a certain number of days or months. However, if the property is part of a probate estate, the court may expect the home to be sold (or distributed) within a reasonable time to settle debts, divide proceeds, or close the estate.

Most probate cases in Michigan are expected to wrap up in 7 to 12 months, though some take longer.

💸 Holding Costs Add Up the Longer You Wait

Even if there’s no legal pressure to sell right away, financial pressure can creep in fast. Consider the monthly costs:

Property taxes
Insurance premiums
Utility bills
Maintenance and lawn care
Mortgage (if one exists)

In some cases, these costs are paid out of the estate. But if the estate lacks cash or you’re co-owning the house with others, these expenses can become a personal burden.

⚠️ Risk of Deterioration or Legal Trouble

Vacant homes deteriorate quickly. If the house sits too long, you may face:

Vandalism or squatters
City code violations
Insurance policy restrictions or cancellation

These risks are why many heirs choose to sell within the first year, especially if no one plans to live in the home long-term.

The bottom line? While Michigan law doesn’t impose a hard deadline, the longer you wait, the more risk and cost you take on. Selling promptly — especially if the home is vacant or in poor condition — can save time, money, and stress.

Selling an Inherited House to a Family Member in Michigan

Sometimes, the right buyer for an inherited home is already in the family. Whether it’s a sibling who wants to keep the house, a cousin who’s been renting it, or a child who hopes to live there, selling to family can feel like a natural choice — and an emotionally satisfying one.

But while the process may feel informal, it still comes with important decisions, rules, and risks.

❤️ Keep Emotions in Check — and Expectations Clear

Family dynamics can make negotiations tricky. If one heir wants to buy and the others want to sell, you’ll need to agree on a fair price and document everything clearly. Avoid handshake deals or verbal agreements — especially when multiple owners or siblings are involved.

Setting expectations in writing can prevent misunderstandings down the road.

💵 Selling Below Market Value? Know the Risks

If you plan to give a “family discount,” be aware that selling significantly below market value could trigger gift tax consequences — especially if the price is far below the appraised value. You’ll also want to consider:

Getting an independent appraisal
Consulting a tax professional if giving a large discount
Using a formal purchase agreement, even among relatives

📝 A Real Sale Still Requires the Right Paperwork

Even if it’s a private sale, you still need:

A legal purchase agreement
A signed deed transfer
Title work and disclosures
Settlement through a proper title company or closing attorney

If probate is still open, the personal representative must sign off on the sale — even if the buyer is part of the family.

Selling to someone you trust can be a great solution — but it’s still a real transaction. Treat it that way, and everyone involved will benefit from the clarity and fairness of doing it right.

"When you mentioned that you would give us an offer within 24 hours and then close quickly I didn’t really believe that we would have the house sold in only 2 weeks. I’m glad I found you.”

Michelle L. - Michigan

What Are Your Options for Selling an Inherited House in Michigan?

Once you're ready to sell, the next big decision is how you’ll sell. Michigan homeowners have a few different paths — and the right one depends on your timeline, the condition of the property, and how much effort you're willing to invest.

Here’s a breakdown of the most common options:

🏡 Option 1: Sell with a Real Estate Agent

Best for: Homes in good condition with no urgency
An experienced agent can help you list the home, reach buyers, and negotiate offers. But keep in mind:

You may need to clean out the house, stage it, and make repairs
Showings and open houses are often required
Closing can take 45–90 days
Agent commissions typically cost 5% to 6%

If you're okay with waiting — and willing to put in some work — this can bring in top dollar.

🤝 Option 2: For Sale By Owner (FSBO)

Best for: Sellers comfortable with handling the process themselves
Selling FSBO means you market and negotiate the sale without a listing agent. This gives you more control and can save on commission — but it also puts all the responsibility on you:

Pricing the home correctly
Handling paperwork and negotiations
Managing buyer expectations and inspections

FSBO works best for those with time, some real estate knowledge, or a buyer already lined up.

💰 Option 3: Sell to a Local Cash Buyer

Best for: Homes that need repairs, or sellers who want speed and simplicity
If the property is outdated, has code violations, or you just don’t want to deal with cleanout or listing delays, a cash buyer can help you close quickly and without hassles. With this option:

No repairs, cleaning, or showings required
You can sell as-is
Closings typically happen in 7–14 days
No agent commissions or hidden fees

This is ideal if you’re dealing with a vacant home, far away from the property, or want to divide proceeds among heirs fast and fairly.

No matter which route you choose, the most important thing is to make the decision that works best for you and your family — not just the one that seems typical.

Frequently Asked Questions About Selling an Inherited House in Michigan

How long do I have to sell an inherited property in Michigan?
There’s no legal deadline, but probate courts typically expect estates to be closed within 12 months. The longer you hold onto the property, the more you’ll pay in taxes, insurance, and maintenance.

Do I have to go through probate to sell the house?
In most cases, yes — unless the property was held in a trust or had joint ownership with survivorship rights. Probate gives the personal representative legal authority to transfer or sell the property.

What taxes will I owe if I sell an inherited house?
You may owe capital gains tax, but Michigan follows the federal step-up in basis rule — meaning the taxable gain is based on the home’s market value at the time of inheritance, not the original purchase price. This often reduces or eliminates tax liability.

What if my siblings don’t agree on selling?
If you inherited the property jointly, all owners must agree to sell — unless one files a partition action through the court. Open communication and fair valuation can help avoid legal disputes.

Can I sell a house that still has a mortgage or reverse mortgage?
Yes, but the outstanding balance must be paid off at closing. A reverse mortgage becomes due upon the original borrower’s death, so timing is important.

What if the house is in bad shape or has violations?
You can still sell it as-is. Many sellers choose to work with cash buyers who specialize in inherited homes that need repairs or are facing fines.

Can I sell the house before probate is complete?
In most cases, no. The sale must wait until the probate court appoints a personal representative with authority to act. However, once that appointment is made, you may be able to list and accept offers during the process.

Need Help Selling an Inherited House in Michigan? Let’s Talk.

You didn’t ask for this situation — and you shouldn’t have to figure it out alone.

Whether you’re dealing with probate, property repairs, or family disagreements, we’ve helped countless Michigan homeowners navigate inherited property sales with clarity, compassion, and a clear plan forward. No pressure. No judgment. Just real answers from someone who’s been through this before.

At Dennis Buys Houses, we offer:

A free, no-obligation conversation about your situation
Fair, cash offers for inherited homes in any condition
Fast closings when you’re ready — or flexibility if you need time
Local experience you can count on

You’ve carried this long enough. If you’re ready to explore your options and get peace of mind, we’re here when you need us.

👉 Contact Dennis today to talk about your inherited property — and take the first step toward relief.

See why so many people recommend us...

“Mr. Fassett – thank you for working with us to buy my Mom’s home after she passed away. When you mentioned that you would give us an offer within 24 hours and then close quickly I didn’t really believe that we would have the house sold in only 2 weeks. I’m glad I found you.”

Michelle L. - Michigan

“Thanks for buying my Mother’s home. It was a big help that you were able to buy it without us having to clean it out and get it ready to sell. My mother had accumulated lots of stuff and after the stress of her long illness I was exhausted and I dreaded dealing with all of it. I also liked it that you gave me a very fair price for the home. I’m on a fixed income and that really helped a lot.”

Henry G. - Michigan

“Dennis – thank you for helping us with our Mom’s home. This was a very traumatic experience for us, and we appreciated your patience with all the emotions we experienced during the process. You were really patient and understanding with us during the sale process, and we’re sure that Mom’s home will be in good hands. God Bless.”

Claudia and Nancy M. - Michigan

We Help Michigan Families Navigate These Situations Every Day

Dennis sitting in a chair in his living room

At Dennis Buys Houses, we’re not just cash buyers — we’re trusted problem-solvers who help Michigan families find real answers during difficult times.

Since 2004, we've been helping homeowners across Michigan sell their properties quickly and easily—without the stress of agents, repairs, or hidden fees.

We’re a family-owned, local business with deep roots in the community. Over the years, we’ve helped hundreds and hundreds of homeowners in situations just like yours—whether they’re dealing with delinquent property taxes, foreclosure, or simply needing a fresh start.

If you're dealing with a tough family situation and don’t know where to turn, we’re here to help.

Start here:

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Whether you’re ready to sell or just want to explore your options, we’re here for you. Call us today, and let’s talk about how we can make your situation easier.

No pressure. No judgment. Just real help when you need it.