Selling an inherited house with "houseguests"

I think the takeaway from the article and from this discussion is that it is not a good idea to take tax or legal advice from SGOTI.
 
OldShooter said:
I think the takeaway from the article and from this discussion is that it is not a good idea to take tax or legal advice from SGOTI.
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Take advice? No. Use the issues raised to help focus your questions to people who bill by the hour? Very useful.
 
silvor said:
I don't think I can hand it off. The language says:

If there is no serving trustee, then (me) shall serve as trustees. If (me) is unable or unavailable to serve as trustee, then (my brother) shall serve as trustee.



But if I can handoff, the bank or lawyer would handle an eviction, sale of the home, sale of the household items?



How much does something like that run?



FWIW, the house is worth about $330k net, and there's about $380k in cash and mutual funds.
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Just let him have the house and transfer $25K to him and you’re even. It’s really not worth severing a relationship when you can easily make both of you even and hopefully smooth things over with this gesture.
 
OldShooter said:
Brother has estranged himself and his family. I don't think the OP has to "propose" anything:

Subject to the wisdom of the lawyer he has hired, I would suggest that the lawyer write a letter to brother stating how the estate will be divided ("Pursuant to paragraphs 3.1 and 5.2.8, the estate will be divided as follows ... ") Certainly the OP does not want to invite negotiations at this point; by his behavior, brother has shown that the time for that is past.

IMO @phil1ben's advice to hire a litigator is brilliant. In the likely event that brother hires an attorney, this sends a clear message to the attorney that the OP is not going to be a patsy and cave in response to whatever the brother wants to demand. Said lawyer will also explain to brother that fighting will probably be expensive with brother paying his own bills plus effectively his half of the estate's legal bills and half of the OP's time billed to the estate.

& yes, I would order an expedited fee appraisal.
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I disagree. The choices are to sell the house and then split the proceeds from the sale of the house and the cash/mutual funds 50/50... or if the brother wants the house to include the value of the house in the overall settlement.... so there is a negotiation to be had if one is going to be smart about it.

It would be silly to sell the house if the brother wants it. At the same time, the brother needs to make a decision as to whether he wants to accept the house as part of his inheritance or not quickly.... hence the suggestion of 7 days. Then if he doesn't want it then he needs to move out so it can be sold.

My guess is that brother will view a "free" house and $25k or $50k of cash as attractive... and if so, that gets the OP a quicker out than if the house has to be sold.

You said:
... Said lawyer will also explain to brother that fighting will probably be expensive with brother paying his own bills plus effectively his half of the estate's legal bills and half of the OP's time billed to the estate.
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... I wouldn't think that the OP's lawyer would talk with the OP's brother as you suggest if the OP's brother has legal representation... the OP's lawyer would talk with the brother's lawyer.
 
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Actually, I was picking up on your idea that the brother gets the house. The difference is that I see no need for negotiation. Just give him the house at an appraised value with boot as necessary to even things up. If brother wants to sell the house, then that is his option. OP is no longer involved.

I am assuming that brother will be represented since he has a chunk of cash from the $1M IRA they are splitting. If he isn't then things are easier. What I intended to say about the lawyers is that the one the brother hires would explain the fee situation to the brother. OP's lawyer cannot talk to the brother if he is represented.
 
I don't see forcing the house on the brother as an option unless the trust specifically provides that the house goes to the brother. It might be that the brother doesn't really want it.

Another thought that I had was that if the brother doesn't want the house that the trust might offer him to pay his new landlord the required deposit and first and last months rent and some cash as an advance on the brother's inheritance to induce him to move out.
 
Going to see the lawyer tomorrow. I’m nervous even though I talked to him at least a half dozen times through the years about other things.

A couple things:
My brother told me at one point he’s 70% sure he wants the house. Except I think he wants his kid to live there until he decides to leave and we “split “ the bills. And then decide in the spring if he really wants to buy. He said ‘who cares, the trust pays the bills’. :(. REALLY??

There’s really no issue over the contents of the house. The auctioneer says around 6k. So I really don’t care. It’s junk to me.
 
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silvor said:
....He said ‘who cares, the trust pays the bills’. :(. REALLY?? ...
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That would piss me off if I was the trustee.

I'd tell him that 1) it isn't his house and that since he is not a trustee that he has ZERO say in how the house and the trust is managed and he doesn't have the right to continue to live there and 2) he has 7 days to decide and if he wants the house as part of his inheritance or not and if he decides that he doesn't want the house then he has 14 days to move out... and that on the 22nd day then "the trust" will change the locks so it would be best that he get his stuff out of the house by then.

If moving out so the house can be sold is a burden financially, the the trust can make him an advance on his inheritance to help with deposit, first and last month's rent, etc. but he doesn't get the money until he has moved out (other than the trust paying deposit/first/last directly to his new landlord).

Some may wonder... but you'd do that to your own brother and his family?... given the way they have behaved... in a heartbeat.
 
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silvor said:
..........My brother told me at one point he’s 70% sure he wants the house..........
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Given that he has already taken on the task of "renting out" the house, I'd say he has made his decision - he is overseeing "his" house. Time to make it official. Your lawyer can assist you with expediting that.
 
Make it clear you have no interest in dragging this out, you need to get on with your life.
Your brother either takes the house as part of his settlement now or it goes up for sale immediately, no waiting and no excuses. Let him know that you are getting a lawyer to deal with the squatter.
I would also remind your brother that if he goes ahead and does take the house and lets the mooching son live in it, he may have a problem trying to collect rent. In the end he could lose everything if he has no money to pay for the house maintenance, taxes etc. It's better to sell when prices are so high, split the money and everyone moves on with their lives. Suggest that he gets a financial advisor to help invest the money for his future retirement. Let him know that you care about him but not so much about his good for nothing kid who needs to fend for himself. If you've vocalized that you don't think it's a good idea, then if it all goes south, your conscience is clear.
By the way 70% sure, sounds to me like a stalling tactic and not a genuine interest.
Also, if want to offer the kid money to move which I think is a horrible idea, he doesn't get a dime up front. He needs to be out of the house, you need to inspect it for any damage and have a locksmith change the locks immediately.
Good luck tomorrow...
 
silvor said:
My dad was sick for over a year, almost died several times in the mean time, and finally passed after being in the hospital 3 weeks.


The BIG problem is my brother's son and wife moved in "temporarily" at least 6 weeks ago.
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silvor.....

Just curious, did your dad's grandson and his wife move into the house while your dad was still there? The timing mentioned in your post seems to indicate they might have been there with their grandfather for three weeks before he went to hospital and passed.

During the year+ your dad was sick, did anyone other than yourself provide care for him or help him out in any way? Or was he able to get through this year+ of severe sickness and near death on his own?
 
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I don't think it will be easy to evict in these covid times.
 
RobbieB said:
I don't think it will be easy to evict in these covid times.
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Another reason to just distribute the house to the brother. Let him deal with the situation he created.
 
Well the eviction ban was struck down officially today by the Supreme Court, so it is probably a moot point. I would lean towards them being trespassers, but they could probably argue they were given permission from the executor (OP) for the initial period they were in there. Either way, eviction is necessary within a reasonable amount of time if the relatives are starting to squat on the residence, the OP probably does not want to start establishing a history of granting them a life estate on the property, when the OP had no intention to gift them one in the first place. Housing is not something you usually use for just a month or two for anything other than a vacation, so I wouldn't assume they will leave promptly after already being notified multiple times. Also, it may be difficult to show the house while they are there, so that is another reason to handle this promptly, it is basically interfering with the original intent of the will if your brother is not buying you out within a reasonable time.

Personally, I could see this having some chance of happening in my case as well. I'm the likely executor, my parents have a paid off house, and my brother is fairly bad with money. I would probably have given them 1-2 weeks to decide whether to buy it. Since 1/2 the house would probably be less than 1/2 the liquid assets, just lower his payout based on half the value of the going rate for the house.

(this is not legal advice)
 
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silvor said:
Going to see the lawyer tomorrow. I’m nervous even though I talked to him at least a half dozen times through the years about other things.

A couple things:
My brother told me at one point he’s 70% sure he wants the house. Except I think he wants his kid to live there until he decides to leave and we “split “ the bills. And then decide in the spring if he really wants to buy. He said ‘who cares, the trust pays the bills’. :(. REALLY??

There’s really no issue over the contents of the house. The auctioneer says around 6k. So I really don’t care. It’s junk to me.
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Any update?
 
He is squatting.
Talk to a lawyer. Present your brother with a short term lease agreement with any rent not paid deducted from his inheritance and a definite date to either proceed with buying the home or vacating - and start eviction procedures. Also, take photos, if possible of the condition of every room so if your brother trashes it, he will pay for repairs.
 
Definitely post after you meet with the attorney. We are going to have a situation, too. I am the executor and the house will be left to five children jointly. My sister and child moved in with my dad recently. I don't think she will want to sell, but she can't afford to buy everyone out. There is a promissory note due upon the death of both parents to be paid from sale proceeds. There are no other assets.
 
Is the house collateral to the promissory note? Is the lien recorded with the county?

You might want to gently let you sister know that she'll need to move soon after you father passes if she can't afford to buy the house so it isn't a surprise to her.
 
HMMY said:
Definitely post after you meet with the attorney. We are going to have a situation, too. I am the executor and the house will be left to five children jointly. My sister and child moved in with my dad recently. I don't think she will want to sell, but she can't afford to buy everyone out. There is a promissory note due upon the death of both parents to be paid from sale proceeds. There are no other assets.
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You may be able to work something out if she is willing to assume the promissory note, plus a reverse mortgage for the difference her portion/her assets cannot pay. I am somewhat doubtful she has the credit+assets for that though if she is really only barely getting by. If the estate is small, the value of the house is bigger, and her credit is shot, that is her own problem, and the only fair option is to sell the house/have it bought by a solvent sibling.
 
plex said:
You may be able to work something out if she is willing to assume the promissory note, plus a reverse mortgage for the difference her portion/her assets cannot pay. I am somewhat doubtful she has the credit+assets for that though if she is really only barely getting by. If the estate is small, the value of the house is bigger, and her credit is shot, that is her own problem, and the only fair option is to sell the house/have it bought by a solvent sibling.
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Sister is too young to qualify for a reverse mortgage. She has excellent credit but makes $11/hour, so not sure what kind of mortgage she could get.
 
It's easy

silvor said:
Which by him buying the house would work out to that anyway. But man, that seems TOO easy.
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It is easy. We did something similar when settling my FIL's estate a few years ago. Cash in lieu of property worked out great for all parties.
 
Yes, unfortunately your brother has put you into a position where you MUST evict him. Otherwise, he can legally claim the entire property under adverse possession laws.

Call an attorney today.
 
Maidensong said:
Yes, unfortunately your brother has put you into a position where you MUST evict him. Otherwise, he can legally claim the entire property under adverse possession laws.

Call an attorney today.
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It takes years before someone can claim adverse possession so I don’t think this is a concern in this situation. They are still squatting though so that needs to be dealt with.
 
Maidensong said:
... Otherwise, he can legally claim the entire property under adverse possession laws. ...
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No. There are specific conditions, the threshold for possession is years, and IIRC the owner of the property must have ignored or accepted the occupancy.

I'm still of the school that says OP just distributes the house to his brother without negotiation plus any boot cash necessary to even up the halves. Let brother deal with squatters; he created the situation.
 
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