I Just Inherited a House in Ohio — What Do I Do Now?

First — I'm sorry for your loss. I know you're probably not reading this because you're having a great week. Someone close to you passed away, and now you're dealing with a house on top of everything else. Grief is hard enough without trying to figure out property law, mortgages, and tax implications.

I've worked with dozens of families across SW Ohio who inherited properties they didn't know what to do with. Some of them kept the house. Some of them sold it. Some had simple situations, and some had a tangled mess of title issues, back taxes, and Medicaid liens that seemed impossible to sort out.

This guide covers everything you need to know, step by step. No legal jargon, no fluff — just the practical information you need right now.

The First 30 Days: What to Do Immediately

You don't need to make any big decisions right away. But there are a few things you should handle quickly to protect the property and yourself:

1. Secure the Property

Make sure the house is locked, windows are closed, and the property is reasonably secure. If it's going to sit empty for a while, consider having the mail forwarded and letting a neighbor know the situation. Empty houses in some parts of Dayton, Cincinnati, and Springfield can attract problems quickly.

2. Keep Up the Insurance

If the deceased had homeowner's insurance, contact the insurance company immediately to let them know about the death. Most policies will stay active for a period, but you may need to switch it to an estate policy or a vacant home policy. If the house sits uninsured and something happens — a pipe bursts, a tree falls — you're looking at a major uninsured loss.

3. Keep Paying the Bills (If You Can)

Property taxes, mortgage payments, utility bills, HOA dues — these don't stop just because the owner passed away. If nobody pays the mortgage, the lender will eventually start foreclosure proceedings. If nobody pays the property taxes, the county starts the tax delinquency process.

You're not legally obligated to pay these bills out of your own pocket if you're not on the deed or the mortgage. But if you want to preserve the property's value (and your eventual inheritance), keeping things current is important.

4. Find Important Documents

Look for the deed, mortgage documents, property tax bills, insurance policies, and — most importantly — a will or trust. These documents determine how the property transfers to you and what steps you need to take.

How Property Transfers After Death in Ohio

This is the part that confuses most people. How the property passes to you depends on how it was titled and whether the deceased had a will or trust. Here are the most common scenarios:

Transfer-on-Death (TOD) Deed — The Easy Path

If the deceased filed a Transfer-on-Death affidavit with the county recorder, the property passes directly to the named beneficiary when the owner dies. No probate required. You just need to file a death certificate with the county recorder's office and the property is yours.

This is the simplest scenario, and it's becoming more common in Ohio. Check with the county recorder in the county where the property is located to see if a TOD affidavit was filed.

Joint Ownership With Right of Survivorship

If the property was owned jointly (like a married couple) with survivorship rights, it passes automatically to the surviving owner. Again, no probate needed — just file the death certificate with the recorder.

Property Held in a Trust

If the property was in a living trust, the successor trustee can sell or transfer the property according to the trust terms without going through probate. This is fairly straightforward but may require working with the attorney who set up the trust.

Everything Else — Probate

If none of the above apply — meaning the property was in the deceased's name alone with no TOD, no joint ownership, and no trust — it has to go through probate. This is the most common situation I see, and it's the one that creates the most confusion.

I wrote a detailed guide on how to sell a house in probate in Ohio that covers the entire process. Here's the short version:

• Someone (usually a family member) files to be appointed executor or administrator of the estate in probate court
• The court grants them authority to manage the estate's assets, including the house
• They can then sell the property, pay debts from the proceeds, and distribute what's left to the heirs
• The probate process typically takes 6-12 months in Ohio, though it can be shorter for small estates

What If There's a Mortgage on the Inherited House?

This is one of the most common questions I get. Here's the deal:

The Mortgage Doesn't Disappear

When someone dies, their mortgage doesn't get forgiven. The debt remains attached to the property. The lender can't come after YOU personally for the debt (it was the deceased's obligation), but they can foreclose on the property if the payments stop.

Federal Law Protects You

Under the Garn-St. Germain Act (a federal law), lenders cannot call the loan due just because the property transferred to an heir through death. You have the right to assume the mortgage and keep making payments. The lender has to let you.

This is important because there's a common myth that when someone dies, the bank can immediately demand full payment. They can't — not as long as you're keeping the payments current.

Your Options With the Mortgage

• Keep the house and assume the mortgage: Contact the lender, provide the death certificate, and request to be added as the borrower. You continue making payments at the existing terms.
• Sell the house and pay off the mortgage: If there's equity (the house is worth more than the mortgage balance), you can sell, pay off the loan, and pocket the difference.
• Let the lender foreclose: If the house is underwater (worth less than the mortgage) and you can't or don't want to make payments, you can walk away. The foreclosure affects the estate, not your personal credit — as long as your name isn't on the loan.

What If the House Is Underwater?

If the deceased owed more on the mortgage than the house is worth, you're not obligated to keep it. You won't owe the difference personally. In some cases, the lender may agree to a short sale — where they accept less than the full balance — especially if the alternative is a costly foreclosure process.

Dealing With Property Taxes on an Inherited House

Property taxes keep accruing whether anyone lives in the house or not. If the deceased was behind on taxes, those back taxes are now the estate's responsibility — and they're a lien on the property.

Here's what you need to know:

• You're not personally responsible for the deceased's back taxes (unless your name is on the deed)
• But the taxes are a lien on the property — they have to be paid to sell or transfer it with clean title
• If taxes stay unpaid, the county will eventually pursue a tax foreclosure
• Ohio's Homestead Exemption only applies to the person who lived there — once they pass, future tax bills are at the full rate

If you're selling the inherited house, the back taxes get paid from the sale proceeds at closing. You don't need to come up with the money beforehand.

Title Issues That Come Up With Inherited Property

This is where inherited properties get tricky — and where most buyers and agents throw up their hands. Here are the title issues I see most often with inherited houses in Ohio:

Medicaid Liens (Estate Recovery)

If the deceased was on Medicaid (especially for nursing home care), the State of Ohio has the right to recover those costs from the estate. This shows up as a lien on the property, and it can be tens of thousands of dollars. The lien has to be addressed before the property can be sold with clean title.

I deal with Medicaid estate recovery liens regularly. They're negotiable in many cases, and there are exemptions that can reduce or eliminate the lien. This is a big part of what I do — resolving liens that other buyers won't touch.

Multiple Heirs

When a house passes to multiple children or family members, everyone has to agree on what to do with it. One sibling wants to sell, another wants to keep it, a third lives across the country and won't return calls. This is one of the most common reasons inherited properties sit vacant for years.

If you're one of multiple heirs and you want to sell, all heirs typically need to sign off — or the executor/administrator needs court authority to sell on behalf of the estate.

No Will and Multiple Potential Heirs

When someone dies without a will in Ohio (called "intestate"), the property passes according to Ohio's inheritance laws. The surviving spouse gets priority, then children, then parents, then siblings, and so on. If there are disputes about who inherits, probate court sorts it out — but it takes time.

Deed Was Never Updated

I see this a lot in Dayton and Cincinnati: someone dies, the family assumes one of them now "owns" the house, but nobody actually goes through probate or files anything with the county. Five, ten, fifteen years go by. Now a second family member has died, and the title is a complete mess. The county still shows the original owner from two decades ago.

This is fixable, but it requires going back and opening probate (sometimes multiple probates) to establish the chain of title. I work with attorneys who handle these tangled estates specifically.

Your Options: Keep, Rent, or Sell the Inherited House

Option 1: Keep the House

If the house is in good condition and in a location you want to live, keeping it might make sense. You'll need to handle the title transfer (through probate or TOD), update insurance, and start paying taxes and any mortgage. If there's no mortgage, you're in a great spot — free and clear property.

Option 2: Rent It Out

If you don't want to live there but the property is in rentable condition, becoming a landlord is an option. Keep in mind that rental properties in Ohio require maintenance, dealing with tenants, and understanding landlord-tenant law. If you're out of state, you'll likely need a property manager (which typically costs 8-10% of monthly rent).

Option 3: List It on the Market

If the house is in reasonable condition and you can wait 30-90 days for a sale, listing with a real estate agent will typically get you the highest price. As a licensed agent with eXp Realty, I can help you with this option too. I'll be honest — if your inherited house is in a good neighborhood, in decent shape, and you have the time to wait, listing is usually the better financial move.

Option 4: Sell to a Cash Buyer

This is the right choice when:

• The house needs major repairs and you don't have the budget
• You live out of state and can't manage a listing from afar
• There are title issues, liens, or probate complications
• Multiple heirs want to be done with it quickly
• You're paying a mortgage/taxes on a house you can't use
• The house has been sitting vacant and you want it off your plate

When you sell to me, you don't need to make any repairs, clean out the house, or deal with showings. I handle the title work, the liens, and the closing. You get a check and move on.

Tax Implications of Inherited Property in Ohio

Good news: Ohio doesn't have an inheritance tax or an estate tax. So you won't owe the state anything just for inheriting the property.

But there are other tax considerations:

The "Stepped-Up Basis" — Your Best Friend

When you inherit a house, the IRS gives you what's called a "stepped-up basis." This means your cost basis for tax purposes is the fair market value of the house on the date of death — NOT what the deceased originally paid for it.

Example: Your parent bought the house in 1985 for $60,000. When they passed, it was worth $150,000. Your stepped-up basis is $150,000. If you sell it for $155,000, you only owe capital gains tax on $5,000 — not on the $95,000 difference from the original purchase price.

This is a huge tax benefit and one of the reasons selling an inherited property can be very favorable from a tax perspective. But the key is knowing the fair market value at the date of death and documenting it. Get an appraisal done, or at minimum pull comparable sales from around that date.

Capital Gains If You Wait to Sell

If you hold the property and it appreciates after the date of death, you'll owe capital gains on the appreciation. If you hold it for more than a year after inheriting it, it qualifies for long-term capital gains rates (which are lower than short-term).

Property Tax Changes

Ohio counties reassess property values periodically. If the deceased had a low assessment from years ago, the inherited property might get reassessed at a higher value — increasing the tax bill. Also, if they had a Homestead Exemption (65+ or disabled), that exemption ends with the owner's death.

Rental Income Tax

If you rent out the inherited property, that rental income is taxable. You can deduct expenses like repairs, insurance, and property management fees, but you'll need to report it on your tax return.

Disclaimer: I'm not a CPA. Talk to a tax professional about your specific situation. I'm giving you the general framework so you know what questions to ask.

The Biggest Mistakes I See With Inherited Properties

After years of buying inherited properties in Ohio, here are the mistakes I see families make most often:

Mistake 1: Doing Nothing

This is by far the most common. The family is grieving, nobody wants to deal with the house, so it just sits there. Months turn into years. Taxes go unpaid. The roof starts leaking. The pipes freeze. What was a $120,000 asset becomes a $60,000 liability. I've seen this play out dozens of times across Dayton and Cincinnati.

Mistake 2: Not Going Through Probate

Families assume that because Mom's will says the house goes to them, they own it. But without going through probate, the deed never changes hands. You can't sell a house if your name isn't on the title (or you don't have executor authority). Five years later, when they finally want to sell, they have to go back and open probate — which is now more complicated because of the time that's passed.

Mistake 3: Sinking Money Into Repairs Before Deciding to Sell

Don't put $20,000 into fixing up an inherited house before you've talked to someone about what it's worth. Sometimes the repairs don't add as much value as you'd think. Get an offer on the house as-is first, then decide if investing in repairs makes financial sense.

Mistake 4: Fighting Between Siblings

When multiple heirs can't agree, the property sits. One wants to sell, one wants to keep it, one wants to rent it out. Meanwhile, nobody is paying the taxes and the house is deteriorating. If you're stuck in this situation, consider having each option evaluated by someone neutral (like me) so everyone is working from the same set of facts.

How I Handle Inherited Properties

When a family contacts me about an inherited house, here's what I do:

1. Assess the situation: I find out where you are in the probate process, what the title looks like, and whether there are any liens or complications
2. Run the numbers: I pull comparable sales, estimate the property's value in current condition and after repairs, and check for any outstanding debts against the property
3. Present all options: I show you what a cash sale looks like, what listing would look like, and what the net proceeds would be under each scenario
4. Handle the complications: If there are title issues, Medicaid liens, missing heirs, or unprobated estates, I work with attorneys and title companies who deal with these specifically
5. Close when you're ready: We work on your timeline. If you need to close fast because you're paying a mortgage on an empty house, we can move in 7-14 days. If you need more time, we wait.

I don't charge anything for the consultation. You'll never owe me a dime unless we actually close a deal, and even then I pay all closing costs on cash purchases.