Selling an Inherited House in Memphis: Complete Probate Guide (2026)

Inheriting a house in Memphis comes with emotional weight and practical challenges. You're grieving while also managing property taxes, insurance, maintenance, and legal requirements you may not fully understand. If the property is across town—or across the country—the burden multiplies.

This guide walks you through everything Memphis heirs need to know: Tennessee probate requirements, your options for selling, tax implications, and how to get maximum value whether you sell traditionally or need cash fast.

Understanding Tennessee Probate

Probate is the legal process of validating a will, paying the deceased's debts, and distributing assets to heirs. In Tennessee, probate is handled by the county's Chancery Court or Probate Court—in Shelby County (Memphis), it's the Probate Court.

When Is Probate Required?

Not all inheritances require full probate. Tennessee offers alternatives depending on the estate size and how assets are titled:

• Full probate required: Real estate solely in the deceased's name with no transfer-on-death deed
• Small estate affidavit: Personal property under $50,000 (doesn't include real estate)
• Summary administration: Estates under $50,000 total value (including real estate)
• No probate needed: Property in a living trust, joint tenancy with right of survivorship, or transfer-on-death deed

Most inherited Memphis homes require some level of probate unless the deceased had a trust or the property was jointly owned.

Who Handles Probate?

The executor (named in the will) or administrator (appointed by the court if no will exists) manages the probate process. This person has legal authority to:

• Access and manage the deceased's assets
• Pay debts and taxes
• Sell property with court approval
• Distribute remaining assets to heirs

The Memphis Probate Process Step-by-Step

Here's what to expect when probating an estate in Shelby County:

Step 1: File the Will (Weeks 1-2)

Within 30 days of death, file the original will with Shelby County Probate Court. If there's no will, file a petition for administration. Filing fees run approximately $350-$500.

Step 2: Appointment of Executor/Administrator (Weeks 2-4)

The court reviews the petition and appoints the executor or administrator. You'll receive "Letters Testamentary" (with a will) or "Letters of Administration" (without a will)—this document gives you legal authority over the estate.

Step 3: Notify Creditors (Months 1-2)

Tennessee law requires you to:

• Publish notice in a local newspaper (Memphis Commercial Appeal or similar)
• Notify known creditors directly
• Creditors have 4 months to file claims

Step 4: Inventory Assets (Months 1-3)

Create a complete inventory of estate assets, including the Memphis property. You may need a formal appraisal for real estate—this establishes the "date of death" value used for tax purposes.

Step 5: Pay Debts and Taxes (Months 3-6)

Settle legitimate creditor claims, pay outstanding property taxes, and handle any estate tax obligations (rare in Tennessee due to high federal exemption).

Step 6: Sell or Transfer Property (Months 4-12)

With court approval, you can sell the inherited property. Traditional sales may require specific procedures; cash sales to investors can sometimes proceed with less formality.

Step 7: Final Distribution and Closing (Months 8-12)

After debts are paid and assets distributed, file a final accounting with the court and request to close the estate.

Your Options for Selling an Inherited Memphis House

Once you have authority to sell (or while pursuing it), you have several paths forward:

Option 1: Traditional Sale with a Real Estate Agent

Timeline: 3-6 months
Net proceeds: 90-95% of market value (after commissions and repairs)

Best for: Heirs who aren't in a rush, have funds for repairs, and the property is in good condition.

Process: List with a Memphis agent, make repairs, stage the home, wait for the right buyer, close through traditional financing.

Challenges: Inherited homes often need updating. You may invest $10,000-$30,000 in repairs only to wait months for a sale. Coordinating showings from out of state adds complexity.

Option 2: Sell As-Is to Cash Buyers

Timeline: 7-21 days
Net proceeds: 70-85% of market value

Best for: Heirs who live out of state, need quick resolution, or inherited a property needing significant repairs.

Process: Submit property details, receive offers from investors, choose the best offer, close quickly.

Advantages:

• No repairs or cleaning needed
• Can often close during probate
• Handle everything remotely
• Cash buyers understand probate complexities
• No risk of buyer financing falling through

Option 3: Keep and Rent

Timeline: Ongoing
Returns: Monthly rental income + long-term appreciation

Best for: Heirs with property management experience or willingness to hire a manager, and properties in good rental locations.

Memphis rental market context: Memphis has strong rental demand. A typical rental property (depending on neighborhood) generates $800-$1,500/month gross rent. However, landlording requires ongoing involvement, and properties in poor condition need renovation before they're rentable.

Option 4: Move In

If you're local and want to live in the home, you can keep it as your primary residence. This may have tax advantages (see below) and avoids the complexity of selling.

Selling an Inherited House During Probate

You don't have to wait until probate closes to sell. Many heirs sell during probate to avoid ongoing carrying costs. Here's how it works:

Getting Court Approval

In Tennessee, the executor typically needs court approval to sell real estate unless the will explicitly grants authority. The process:

1. File a petition with Shelby County Probate Court requesting permission to sell
2. Provide documentation (appraisal, proposed sale terms, reason for sale)
3. Court reviews and either approves or requires modifications
4. Proceed with sale under court supervision

Cash Buyers and Probate Sales

Cash buyers often prefer probate properties because:

• They understand the process and required timelines
• They can wait for court approval without financing deadlines
• They purchase as-is, ideal for inherited properties that need work
• They handle title complexities common in estates

When selling to cash buyers during probate, proceeds are typically held in the estate account until the estate closes, then distributed to heirs per the will or intestacy laws.

Tax Implications of Selling an Inherited Memphis House

Understanding taxes helps you plan your sale and maximize what you keep.

Tennessee Taxes (Good News)

• Inheritance tax: None. Tennessee eliminated its inheritance tax in 2016.
• Estate tax: None at the state level.
• Income tax on sale: None. Tennessee has no state income tax.

Federal Taxes

• Estate tax: Only applies to estates over $12.92 million (2024). Most Memphis inheritances won't owe federal estate tax.
• Capital gains tax: May apply if you sell the property for more than its value at the date of death.

Understanding Stepped-Up Basis

This is the most important tax concept for inherited property. Your "cost basis"—the value used to calculate gains—isn't what the deceased paid. It's the fair market value at their date of death.

Example:

• Deceased bought Memphis home in 1985 for $45,000
• Fair market value at death (2025): $175,000
• You sell in 2026 for $180,000
• Your taxable gain: $180,000 - $175,000 = $5,000 (not $135,000)

This "stepped-up basis" can save heirs tens of thousands in capital gains taxes.

Capital Gains Tax Rates

If you sell above the stepped-up basis and held the property more than one year, long-term capital gains rates apply:

• 0% if income under $44,625 (single) / $89,250 (married)
• 15% if income $44,626-$492,300 (single) / $89,251-$553,850 (married)
• 20% if income above those thresholds

Common Challenges with Memphis Inherited Properties

Multiple Heirs with Different Goals

When siblings inherit together, conflicts arise. One wants to sell quickly, another wants to keep it, a third wants maximum price regardless of timeline. Solutions:

• One heir buys out the others
• Agree on a timeline and method (cash vs. traditional)
• Partition sale through the court (last resort, expensive)

Property in Poor Condition

Memphis has many older homes. If you inherited a property built in the 1950s-1970s, you may face:

• Deferred maintenance (roof, HVAC, plumbing)
• Outdated electrical systems
• Foundation issues common in Memphis clay soil
• Code violations (see our Memphis code violations guide)

Cash buyers purchase as-is, eliminating the need to address these issues before selling.

Outstanding Liens or Mortgages

The deceased's debts attach to the estate, not to you personally. But liens must be satisfied before clear title can transfer. Common scenarios:

• Remaining mortgage: Paid from sale proceeds or by estate
• Property tax liens: Shelby County tax liens paid at closing
• Contractor liens: Must be resolved before sale
• Reverse mortgage: Due upon death, typically 6 months to resolve

Squatters or Unauthorized Occupants

Vacant properties in some Memphis neighborhoods attract squatters. If you discover someone living in the inherited property without authorization:

• Do not attempt self-help eviction (illegal in Tennessee)
• File for eviction through Shelby County General Sessions Court
• Timeline: typically 2-4 weeks once filed
• Cash buyers sometimes handle occupied properties, though at lower offers

The Cost of Holding an Inherited Memphis Property

Every month you hold an inherited property costs money. Calculate your carrying costs to make an informed decision:

Monthly Carrying Costs (Typical Memphis Inherited Property)

• Property taxes: $150-$400/month (Shelby County average)
• Insurance: $100-$200/month (vacant property rates higher)
• Utilities: $100-$200/month (basic service to prevent damage)
• Lawn/maintenance: $100-$150/month
• Mortgage (if any): Varies

Total: $450-$950/month or $5,400-$11,400/year

Hidden Costs

• Code violation fines (Memphis actively enforces)
• Vandalism or theft from vacant property
• Trip costs if you're managing from out of state
• Time and stress of property management

A 6-month traditional sale process could cost $2,700-$5,700 in carrying costs alone—sometimes more than the difference between a cash offer and traditional sale price.

Realistic Timeline for Selling Inherited Memphis Property

Traditional Sale Timeline

Cash Sale Timeline

Frequently Asked Questions

How long does probate take in Tennessee?

Standard Tennessee probate takes 6-12 months. Complex estates or those with disputes can take longer. Small estates under $50,000 may qualify for simplified procedures that take 45-60 days.

Can I sell before probate is complete?

Yes, but you typically need court approval and must be appointed as executor or administrator first. Some buyers, particularly cash investors, specialize in purchasing properties during probate.

What if the will is contested?

Will contests freeze the estate until resolved. Selling usually requires all parties to agree or the court to rule. This can add months or years to the timeline.

Do I need a probate attorney?

Tennessee doesn't require an attorney, but estates with real estate generally benefit from professional guidance. Expect $2,000-$5,000 for straightforward probate, more for complex estates.

What if there's no will?

The estate passes according to Tennessee's intestacy laws. For most people, this means spouse and children inherit first. The court appoints an administrator to manage the estate.

Can I refuse an inheritance?

Yes. You can "disclaim" an inheritance within 9 months of death. The property passes as if you predeceased the owner. This may make sense for properties with more liabilities than value.

What happens if the house has a mortgage?

The mortgage becomes the estate's responsibility. Options include paying off the mortgage from estate funds, selling the property to pay off the mortgage, or transferring the mortgage to an heir who keeps the property (lenders sometimes allow this for inherited homes).