I Inherited a House in Florida. What Are My Options?

What This Means

Inheriting a home in Florida can be both a gift and a responsibility. While inheriting a property can provide financial opportunity, it also comes with decisions that need to be made within specific timeframes. Understanding your options, the probate process, mortgage rules, and tax implications will help you make informed decisions.

This guide covers the most common situations Florida heirs face. Every situation is different, and you should consult with qualified professionals for advice specific to your circumstances.

Step 1: Determine How the Property Was Held

The first question to answer is how the deceased owned the property. This determines whether probate is needed and how the property transfers to you.

Joint Ownership with Right of Survivorship

If the property was owned jointly with rights of survivorship, ownership transfers automatically to the surviving owner. Probate is not required. The surviving owner simply files a certified copy of the death certificate with the county property appraiser.

Revocable Living Trust

If the property was held in a trust, the successor trustee takes control and transfers the property to the beneficiaries according to the trust terms. This avoids probate and is generally the fastest path. The process can be completed in weeks rather than months.

Lady Bird Deed (Enhanced Life Estate Deed)

Florida allows a special type of deed called a Lady Bird deed or enhanced life estate deed. This allows the property owner to retain control during their lifetime and automatically transfer ownership to named beneficiaries upon death, completely avoiding probate. This is a common estate planning tool in Florida.

Sole Ownership with No Estate Plan

If the property was owned solely by the deceased with no trust or Lady Bird deed in place, the property must go through Florida probate court before it can be transferred to the heirs.

Step 2: Understand the Probate Process (If Required)

Florida probate is a court-supervised process for administering a deceased person's estate. For real estate, there are two main types:

Formal Administration

Required for estates worth more than $75,000. This process typically takes 6 to 12 months. The court appoints a personal representative (executor) who manages the estate, notifies creditors, pays debts and taxes, and distributes assets to heirs. If the property needs to be sold during probate, the personal representative must get court approval.

Summary Administration

Available for estates worth $75,000 or less, or if the deceased has been dead for more than 2 years. This is faster and less expensive, typically taking 1 to 3 months. The process involves filing a petition with the probate court and receiving an order distributing the assets.

Important: Do not sell or transfer an inherited property before receiving legal authority from the probate court (if probate is required). Acting without court authority can create legal complications.

Step 3: Understand the Mortgage

The mortgage does not disappear when the homeowner dies. It transfers with the property. However, federal law provides important protections for heirs.

The Garn-St. Germain Act

This federal law (12 U.S.C. Section 1701j-3) prohibits lenders from enforcing due-on-sale clauses when a property is transferred to a relative upon the borrower's death. This means the lender cannot demand full repayment of the mortgage just because the property was inherited. You can continue making payments under the same terms.

Your Options with the Mortgage

Continue making payments: You can simply keep paying the mortgage under the existing terms. The lender cannot force you to pay off the loan immediately. You do not need to formally assume the loan to continue making payments.

Formally assume the loan: For FHA and VA loans, you may be able to formally assume the loan into your name. FHA loans often allow assumption by heirs without a credit check. VA loans also allow assumption by eligible heirs.

Refinance: If you want to put the loan in your name and potentially secure better terms, you can refinance the mortgage. This requires you to qualify based on your own credit and income.

Pay off the mortgage: If you have sufficient funds, you can pay off the mortgage balance and own the property free and clear.

Sell and use proceeds to pay the mortgage: Selling the property and using the sale proceeds to pay off the mortgage is a common option, especially for heirs who do not want to become property owners.

Step 4: Understand Tax Implications

Florida has no state inheritance tax or estate tax. The Florida Constitution prohibits these taxes entirely. However, there are federal tax considerations.

Stepped-Up Basis (Step Up in Basis)

One of the most important tax benefits of inheriting property is the stepped-up basis. When you inherit property, its tax basis is "stepped up" to its fair market value on the date of the original owner's death (or an alternate valuation date). This means if you sell the property shortly after inheriting it, you may owe little or no capital gains tax. For example, if the original owner bought the home for $100,000 and it is worth $300,000 when you inherit it, your tax basis is $300,000. If you sell it for $300,000, you owe no capital gains tax.

Federal Estate Tax

The federal estate tax applies only to estates worth more than the exemption amount. In 2026, the federal estate tax exemption is $15 million per person. Very few estates are subject to this tax.

Property Taxes

When you inherit a property in Florida, the homestead exemption and the Save Our Homes 3% assessment cap do not automatically transfer to you unless you are the surviving spouse and continue living in the home. For other heirs, the property is reassessed at its full market value, which can result in a significant property tax increase.

Step 5: Choose Your Path

Once you understand how the property is held and the legal and tax implications, you can choose your path.

Option 1: Keep the Property and Live in It

If you want to live in the inherited home, you can move in, continue making mortgage payments (or pay off the mortgage), and establish homestead protection. You will need to file a new homestead exemption application with the county property appraiser. The property tax will be reassessed at the full market value unless you are the surviving spouse of the original owner.

Best for: Heirs who want to use the property as their primary residence and can afford the ongoing costs.

Option 2: Sell the Property

Selling an inherited property is one of the most common choices. Because of the stepped-up basis, you may owe little or no capital gains tax. You can sell through a traditional listing with a real estate agent or accept a cash offer for a faster, simpler sale. The sale proceeds are distributed according to the will or Florida's intestacy laws.

Best for: Heirs who do not want to own the property, cannot afford the costs, or prefer to receive cash instead.

Option 3: Rent the Property

If you want to keep the property as an investment, you can rent it out to generate income. The rental income can cover the mortgage, taxes, insurance, and maintenance costs. This option requires you to be a landlord or hire a property management company.

Best for: Heirs who want ongoing income from the property and are prepared for landlord responsibilities.

Option 4: Buy Out Other Heirs

If multiple heirs inherited the property, one heir can buy out the others' shares. This allows the buying heir to become the sole owner while the other heirs receive cash. You will need to agree on a fair market value for the property and arrange financing if needed.

Best for: One heir who wants to keep the property while other heirs want their share in cash.

Option 5: Disclaim the Inheritance

If you do not want the property and do not want the responsibility, you can disclaim (reject) the inheritance. The property then passes to the next eligible heir as if you had predeceased the original owner. This must be done within 9 months of the date of death and before you accept any benefit from the property.

Best for: Heirs who do not want the financial or legal responsibility of the property.

Option 6: Walk Away (Allow Foreclosure)

If the property has little or no equity and you cannot afford the mortgage, you can simply stop making payments and allow the lender to foreclose. As an heir, you are generally not personally liable for the mortgage debt beyond the value of the property. However, foreclosure will affect your credit and should be a last resort.

Best for: Heirs who have no equity in the property and cannot afford to keep or sell it.

Important Florida Considerations

Homestead Protection

Florida's homestead protections shield your primary residence from most creditors. However, if you inherit a property that was the original owner's homestead, those protections do not automatically transfer to you. You must live in the property and file your own homestead exemption application.

Creditor Claims

In Florida probate, creditors have 3 months from the date of the first publication of notice to creditors to file claims against the estate. If the property has liens (mortgage, HOA liens, tax liens, judgment liens), those debts must be addressed before or during the transfer of the property.

HOA and CDD Fees

If the inherited property is in a community with HOA fees or CDD assessments, those obligations continue even during probate. The personal representative is responsible for paying these fees from the estate to prevent liens or foreclosure.

Property Insurance

You must maintain adequate property insurance on the inherited home. If the property is vacant during probate, you may need a vacant property insurance policy. Standard homeowners insurance may not cover vacant properties.

Timeline

Florida probate for real estate typically takes 6 to 12 months for formal administration and 1 to 3 months for summary administration. Selling the property can take additional time depending on the market. Acting promptly is important to avoid unnecessary costs and complications.

How to Decide

Choosing the right path depends on several factors. Ask yourself these questions:

• Do I want to live in this property? If yes, keeping the home and assuming the mortgage may be the right path.
• Can I afford the mortgage, taxes, insurance, and maintenance? If not, selling or renting may be better options.
• Is there significant equity in the property? If yes, selling can provide a meaningful financial benefit.
• Are there multiple heirs who need to agree? If yes, communication and legal guidance are essential.
• Is probate required? If yes, work with a probate attorney to understand the timeline and requirements.
• What is the property condition? A home needing significant repairs may be sold as-is to a cash buyer.

Hypothetical Example

Resources for Heirs in Florida

• Find a probate attorney: The Florida Bar has a lawyer referral service. Call (800) 342-8011 or visit floridabar.org.
• County property appraiser: Each Florida county has a property appraiser's office that handles homestead exemption, property tax information, and ownership records.
• HUD-approved housing counseling: Free or low-cost counseling for housing decisions. Call (800) 569-4287.

Frequently Asked Questions

Do I inherit the mortgage when I inherit a house in Florida?

The mortgage transfers with the property. Federal law (the Garn-St. Germain Act) protects heirs from due-on-sale enforcement, meaning the lender cannot demand full repayment just because the owner died. You can continue making payments under the same terms.

Do I have to go through probate to inherit a house in Florida?

Not always. If the property was held in a revocable living trust, under a Lady Bird deed, or owned jointly with rights of survivorship, probate is typically not needed. If the property was solely in the deceased's name, probate is required.

Does Florida have an inheritance tax?

No. Florida has no state inheritance tax or estate tax. The Florida Constitution prohibits these taxes. The federal estate tax applies only to estates over the exemption amount ($15 million per person in 2026).

Can I sell an inherited house before probate is complete?

Generally, no. You must have legal authority from the probate court to sell. The personal representative can request court permission to sell property during probate. Acting without authority can create legal complications.

What is a stepped-up basis and how does it save me money?

A stepped-up basis means the property's tax basis is reset to its fair market value on the date of the original owner's death. This reduces or eliminates capital gains tax when you sell. For example, if the original owner bought the home for $100,000 and it is worth $300,000 when you inherit it, your basis is $300,000, not $100,000.

What happens to property taxes when I inherit a house in Florida?

If you are not the surviving spouse, the property is reassessed at full market value. The homestead exemption and the Save Our Homes assessment cap do not transfer to you. You can file your own homestead exemption application if you live in the property.

Can I disclaim an inherited property in Florida?

Yes. You can formally disclaim (reject) an inheritance within 9 months of the date of death. The property then passes to the next eligible heir. You must not have accepted any benefit from the property before disclaiming.

What happens if multiple heirs inherit the same property?

All heirs typically become co-owners. Any heir can request a partition sale to force the sale of the property, though this is a legal process. Many heirs agree to either sell the property and split the proceeds, or have one heir buy out the others.

Sources and Further Reading

• Welch Law - Inheriting a Home in Florida
• Florida Statutes - Title XLIII (Probate and Estates)
• Garn-St. Germain Act - 12 U.S.C. Section 1701j-3
• CFPB - Consumer Financial Protection Bureau
• IRS - Transfer of Estate Assets
• Senior Homeowners: Options When You Cannot Keep Up
• Selling a House Fast in Central Florida