Leonidas
Thinks s/he gets paid by the post
My dear father-in-law passed away this past October and as my in-laws go through probate the family bonds have been tested a little here and there. Nobody in the family has a financial clue except how to make money and then spend it before it gets stale. Add in an executrix (one of DW's older sisters) who has been a three-time finalist in the bitch-of-the-year contest, declared bankruptcy in the past, and has no financial skill other than how to write a check; and, my life is occasionally brightened by some bizarre questions about probate.
I'm desperately trying to stay out of it, but after the Princess spends a little quality time with one or more of her siblings she comes to me in total confusion and consternation about some point of ignorance passed on to her. We had some "teachable moments" and she's considerably chilled out on the issue now.
Most of it has just been sibling issues from childhood that just won't die in that family that get intertwined with their collective lack of knowledge about finances and probate. A little information goes a long way to cool their jets and I can go back to living my peaceful life.
That was until DW dropped a little piece of information on me the other day.
To make a long story short, one of the other sisters owes a boatload of money to their father's estate. She owns her own business, usually makes a lot of money, but rapidly spends every dollar and has totally ruined her credit (bankers chuckle before they tear up her loan applications). Daddy was her only source of credit to purchase some land to store her heavy equipment.
The bombshell that DW dropped on me is that when their father became incapacitated and unable to handle his finances, her sister stopped making payments on the loan. The family member in charge of their ill-father's finances either didn't know about the loan or didn't press their sister for payments. But now that the will is in probate, the executrix is on the trail and has called the loan.
I know that the odds of my SiL having the money to pay off the remaining balance on the loan is less than non-existent. She may be able to borrow the money from her boyfriend (a successful business owner who is a strong LBYMer) who almost certainly has the money to loan her. If he's crazy stupid enough to loan her the money is another matter altogether.
So, here's my question: If a heir to an estate owes the estate money, and has no ability to repay, what are the possible solutions? I think that the pack of financial geniuses that are my in-laws believe they can just ignore the loan balance, liquidate the estate, pay the heirs, and just deduct the loan amount from the one SiL's inheritance. I think that pulling that is a serious boner, probate wise, and neither the attorney nor the court are going to bless that idea. Which leaves SiL in a pickle with the estate and the executrix forced to sue her sister on behalf of the estate.
Have any of you folks ran across anything similar, or have any insight into how this can be legitimately resolved?
Edit to add: Totally forgot this point: Selling the land to recoup the money is totally out. FiL was smart enough to put a lien on the land when the loan was made, but the attorney who filed the lien used the wrong address. Sometime after FiL was incapacitated and SiL stopped making payments, she sold the land and kept the proceeds - actually spent the proceeds. There is some poor innocent land owner out there with a lien on some other piece of property, but the land on which the loan was based has been sold and the money was hosed off. Yes, I am aware that my in-laws are the five-Stooges of personal finance.
I'm desperately trying to stay out of it, but after the Princess spends a little quality time with one or more of her siblings she comes to me in total confusion and consternation about some point of ignorance passed on to her. We had some "teachable moments" and she's considerably chilled out on the issue now.
Most of it has just been sibling issues from childhood that just won't die in that family that get intertwined with their collective lack of knowledge about finances and probate. A little information goes a long way to cool their jets and I can go back to living my peaceful life.
That was until DW dropped a little piece of information on me the other day.
To make a long story short, one of the other sisters owes a boatload of money to their father's estate. She owns her own business, usually makes a lot of money, but rapidly spends every dollar and has totally ruined her credit (bankers chuckle before they tear up her loan applications). Daddy was her only source of credit to purchase some land to store her heavy equipment.
The bombshell that DW dropped on me is that when their father became incapacitated and unable to handle his finances, her sister stopped making payments on the loan. The family member in charge of their ill-father's finances either didn't know about the loan or didn't press their sister for payments. But now that the will is in probate, the executrix is on the trail and has called the loan.
I know that the odds of my SiL having the money to pay off the remaining balance on the loan is less than non-existent. She may be able to borrow the money from her boyfriend (a successful business owner who is a strong LBYMer) who almost certainly has the money to loan her. If he's crazy stupid enough to loan her the money is another matter altogether.
So, here's my question: If a heir to an estate owes the estate money, and has no ability to repay, what are the possible solutions? I think that the pack of financial geniuses that are my in-laws believe they can just ignore the loan balance, liquidate the estate, pay the heirs, and just deduct the loan amount from the one SiL's inheritance. I think that pulling that is a serious boner, probate wise, and neither the attorney nor the court are going to bless that idea. Which leaves SiL in a pickle with the estate and the executrix forced to sue her sister on behalf of the estate.
Have any of you folks ran across anything similar, or have any insight into how this can be legitimately resolved?
Edit to add: Totally forgot this point: Selling the land to recoup the money is totally out. FiL was smart enough to put a lien on the land when the loan was made, but the attorney who filed the lien used the wrong address. Sometime after FiL was incapacitated and SiL stopped making payments, she sold the land and kept the proceeds - actually spent the proceeds. There is some poor innocent land owner out there with a lien on some other piece of property, but the land on which the loan was based has been sold and the money was hosed off. Yes, I am aware that my in-laws are the five-Stooges of personal finance.