A paid-off inherited home can still cost thousands per month — attorneys explain how to protect yourself

Homeownership is something many people aspire to and, in fact, 56% of adults describe owning your own property as a key part of the American Dream. Yet, many are struggling to buy a home of their own thanks to rising costs of both homes and mortgages.

But, what if you didn't buy a home but inherited one instead? For some, this may seem like a dream come true — but that's not the case in every situation. Let's pretend, for example, that Mika's grandmother, Enid, owns Mika's childhood home and wants Mika to inherit it.

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The only problem is, the home is old, needs a ton of work, isn't in a desirable location and Mika doesn't want it. And Mika isn't necessarily wrong in her concern about inheriting.

"In theory, inheriting a home sounds like getting a free asset but, in practice, we often see it become one of the most expensive and contested assets a family deals with," Scott Rahn a probate, estate, and trust litigation attorney and founding partner of RMO LLP, told Moneywise.

Here's why inheriting a home may actually be a problem, and what you should do if you're on track to get a house that could end up being a curse instead of a blessing.

Inheriting a home can come with significant downsides

Unfortunately, an inherited home can sometimes come with big issues that heirs like Mika just don't want to deal with.

"Even when a home is paid off, you're stepping into ongoing obligations, property taxes, insurance, upkeep, and if multiple heirs are involved, those costs, and their desire and ability to pay those costs, can quickly become a source of disagreement," Rahn said. "We routinely see families spend significant money and time fighting over what to do with a single property."

It's not a surprise that families would fight over the finances of an inherited home, as a lot of money is at stake. "A paid-off inherited home can still cost thousands per month to maintain before improving one dollar," Evan H Farr, a certified elder law attorney and principal attorney at Farr Law Firm told Moneywise.

Farr explained that inherited homes often require immediate cash outlays to address structural issues like roofs and HVAC systems. He also warned that environmental problems like mold or asbestos or underground tanks could lead to unexpected costs and that, "if the home hasn't been modernized, sale and rental values may be limited unless renovated."