Questions about Will for my sister

[FREE866]

Hi there. This board has been a great resource for me on numerous occasions so figured I'd put this question out there.


My sister is 62 years old and lives in her house with her youngest daughter who is 22. She needs to have a will and we are meeting with an attorney in a couple of weeks.
The daughter she lives with is mentally unstable so she does not want to leave the house to her and we have discussed having a stipulation put in the will that the house must be put on market for sale six months after my sister's passing.


If I have her put the house in my name what will be my responsibilities and what possible risks would I be exposing myself to?


thx

 

[njhowie]

A better/alternative approach than putting it in your name, which my mom did for me and my sis, is to put the property into a life estate and you are the "remainderman".

https://www.legalzoom.com/articles/what-is-a-life-estate-deed

Going this route, it doesn't have to go into the will, it won't go through probate, and the transfer is automatic upon her passing.

At that time, you would become the owner - or she could have others also included and you'd get joint ownership upon her passing. You could then sell the property according to her wishes - though legally you wouldn't be required to. Discuss with the attorney and he/she could advise on this option or other alternatives that might accomplish what you want.

 

[OldShooter]

The house is probably not your biggest issue. What will happen to the daughter after your sister dies? Hopefully you will be working with an expert trusts & estates attorney who can paint some problem scenarios for you and suggest solutions. The daughter should not be at this meeting.

You probably do not, for example, want the daughter to end up homeless, to move in with you, or to become a financial burden on you. You might also want to talk to your county's Adult Protection people to investigate future options even if there are no immediate issues. Your state almost certainly also has some kind of centralized senior citizen resource that could point you at resources that could be brought to bear in the future or even now.

 

[FREE866]

A better/alternative approach than putting it in your name, which my mom did for me and my sis, is to put the property into a life estate and you are the "remainderman".

https://www.legalzoom.com/articles/what-is-a-life-estate-deed

Going this route, it doesn't have to go into the will, it won't go through probate, and the transfer is automatic upon her passing.

At that time, you would become the owner - or she could have others also included and you'd get joint ownership upon her passing. You could then sell the property according to her wishes - though legally you wouldn't be required to. Discuss with the attorney and he/she could advise on this option or other alternatives that might accomplish what you want.

Thx for that link Howie. I guess Im trying to understand what the purpose would be. Maybe I should be more clear, we don't want my sister to die and then have her mentally unstable daughter living in the house all alone. The place would go to ashes as she is extremely irresponsible and would not be able to "manage" all that is involved with maintaining a house- upkeep, etc We would want something that legally says "house must be sold" ie "you have to move out" and then I would get her a rented apartment somewhere.



My question was also about what would be involved in me owning the home for those 6 months before it is sold.

 

[FREE866]

The house is probably not your biggest issue. What will happen to the daughter after your sister dies? Hopefully you will be working with an expert trusts & estates attorney who can paint some problem scenarios for you and suggest solutions. The daughter should not be at this meeting.

You probably do not, for example, want the daughter to end up homeless, to move in with you, or to become a financial burden on you. You might also want to talk to your county's Adult Protection people to investigate future options even if there are no immediate issues. Your state almost certainly also has some kind of centralized senior citizen resource that could point you at resources that could be brought to bear in the future or even now.

All good points. As I noted above the "plan" would be for me to get her a 1BR rental somewhere.

 

[njhowie]

Thx for that link Howie. I guess Im trying to understand what the purpose would be. Maybe I should be more clear, we don't want my sister to die and then have her mentally unstable daughter living in the house all alone. The place would go to ashes as she is extremely irresponsible and would not be able to "manage" all that is involved with maintaining a house- upkeep, etc We would want something that legally says "house must be sold" ie "you have to move out" and then I would get her a rented apartment somewhere.

My question was also about what would be involved in me owning the home for those 6 months before it is sold.

Sorry if I misinterpreted. If the daughter remaining is the primary concern, then as OldShooter says, you should focus more on what will happen with her upon your sister's passing.

If the house is put into your name, even for a short period, then as with any property, you are the legally responsible party and have to pay the property taxes, insurance, and any other expenses associated. If there are any liens or outstanding mortgage(s) on the property, then you become responsible for remedying them. Similarly, if the property is sold, you will be the beneficiary of whatever the net amount the property sells for.

I think you should still discuss the life estate option with the attorney, or have the property retitled as joint ownership with rights of survivorship, or something else which accomplishes a similar result. How will you otherwise go about putting the property into your name after your sister passes? You need to have something that is effectively the same as Transfer on Death. Otherwise there isn't going to be a way to put in your name unless she leaves it to you in the will and it goes through probate, and that may take more than 6 months to accomplish or get messy. Once she passes, everything that does not have a beneficiary is going to go through probate.

 

[FREE866]

Sorry if I misinterpreted. If the daughter remaining is the primary concern, then as OldShooter says, you should focus more on what will happen with her upon your sister's passing.

If the house is put into your name, even for a short period, then as with any property, you are the legally responsible party and have to pay the property taxes, insurance, and any other expenses associated. If there are any liens or outstanding mortgage(s) on the property, then you become responsible for remedying them. Similarly, if the property is sold, you will be the beneficiary of whatever the net amount the property sells for.

Gotcha. Yeah, I figured as much about expenses. Just trying to figure out the simplest way to construct will. I appreciate your comments.

 

[pb4uski]

I wonder if it would be best to create a living trust with your sister as grantor, beneficiary and trustee and put the house in it.

You would become trustee upon your sister's death, with the trust requiring that upon the grantor's death that the house be vacated and sold, with the proceeds from the sale remaining in the trust with the daughter as the beneficiary of the trust.

Then if your niece asks why she must move out when her mom dies you can just say that the trust requires it and you have no choice.

Would your sister have other assets that can be put in the trust to provide for housing for your niece while the house is being sold?

 

[FREE866]

I wonder if it would be best to create a living trust with your sister as grantor, beneficiary and trustee and put the house in it.

You would become trustee upon your sister's death, with the trust requiring that upon the grantor's death that the house be vacated and sold, with the proceeds from the sale remaining in the trust with the daughter as the beneficiary of the trust.

Then if your niece asks why she must move out when her mom dies you can just say that the trust requires it and you have no choice.

Would your sister have other assets that can be put in the trust to provide for housing for your niece while the house is being sold?

Thats an interesting idea, but the underlying concern is that she does not want the daughter to have access to a windfall of money. As cold as that sounds, the daughter received a chunk of money when her dad ( my sisters husband) died last year and she is spending 10K a month on useless ebay purchases. Yeah, its bad. She's very ill----no college, refuses to work, etc



If a Will suffices to just put the house in my name with a stipulation to sell house in 6 months I'd rather that then paying for a trust creation. Those are my thoughts at this time.

 

[mystang52]

I am not a lawyer, and have no magical answers. From a practical perspective, in the event your sister dies I recommend you find that 1BR apartment immediately and tell the daughter she needs to vacate the house immediately. It sounds like the daughter might trash the home if she could live there a full six months before the house was sold.

 

[FREE866]

I am not a lawyer, and have no magical answers. From a practical perspective, in the event your sister dies I recommend you find that 1BR apartment immediately and tell the daughter she needs to vacate the house immediately. It sounds like the daughter might trash the home if she could live there a full six months before the house was sold.

While that is definitely a possibility I can't see her doing something like that.

 

[pb4uski]

Thats an interesting idea, but the underlying concern is that she does not want the daughter to have access to a windfall of money. As cold as that sounds, the daughter received a chunk of money when her dad ( my sisters husband) died last year and she is spending 10K a month on useless ebay purchases. Yeah, its bad. She's very ill----no college, refuses to work, etc



If a Will suffices to just put the house in my name with a stipulation to sell house in 6 months I'd rather that then paying for a trust creation. Those are my thoughts at this time.

The beauty of the trust is that as trustee you will decide how much your niece gets and when. Or you could have the trust buy a SPIA that provides monthly income for the niece if you prefer.

Trust creation is not expensive. You could even do it in Willmaker and then be sure to record a new deed that puts the house in the living trust. No need for probate at all either which is a huge benefit.

My mom died in November and the trusts assets were distributed to beneficiaries less that a month later.

 

[thod]

We have a similar situation. Except ours is because my sister is dependent on government medical assistance programs. Therefore, she can never have assets in her name. So, my father has created a trust, put the house into it, also at time of death a number of financial accounts will go into a special needs trust to provide her support later.

I am counting on that the attorney did a good job setting it up and that my father got everything titled correctly, so that it works as intended and of course probate is not necessary. He did recently have things changed again, because the situation went from 2 houses (his and hers), to just one house as they are now living together due to a change in her health situation.

It is a little different, because our trust(s) must continue for her lifetime, whereas you might just need one to long enough to control how the assets are inherited.

 

[njhowie]

As we are seeing from the combined experience of those here, there are multiple ways to skin a cat. Now that FREE866 has a few alternatives, he can bring them up at his attorney meeting and attorney can go over the benefits of each, and possibly some other alternatives and decide which would serve his sister's objectives best.

 

[OldShooter]

As we are seeing from the combined experience of those here, there are multiple ways to skin a cat. Now that FREE866 has a few alternatives, he can bring them up at his attorney meeting and attorney can go over the benefits of each, and possibly some other alternatives and decide which would serve his sister's objectives best.

This!

 

[FREE866]

Thank you everyone. We are meeting with attorney in a couple of weeks and I will report back. This board is awesome!

 

[obsessed]

Regarding the sale of the house. A will can be worded (and often is) in a way that the estate sells the house and the proceeds are then distributed to the beneficiaries of the will. That way you never have to take title of the house.

 

[LateToFIRE]

OP, I've had a couple of situations where an unstable or less than responsible family member occupied a property that was part of the estate and needed to be sold off - so I kinda get the nuts and bolts of the situation.

I think posters have detailed lots of very good reasons you do not want to take ownership of the property. The first being liability. The other being the potential appearance of impropriety - imagine you're trying to evict the daughter who then gets paranoid you're trying to steal her inheritance and takes you to court. And actually, in some jurisdictions, the daughter could have certain "squatter" rights to remain in the house as a direct kin of the deceased. Third consideration is remote, but what if your sister needs Medicaid-funded LTC, the transfer of the property to you could subject your assets to financial exposure. One other thing, is the unpredictability of life - what if you're hit by a bus, who does the house pass to and would they honor the handshake agreement you had with your sister.

My vote is for a trust structure like what pb4uski was suggesting. This way, its clear that you don't have direct liability, but you would have significant control to carry out your sisters wishes as defined in the parameters of the trust document. The trust document would also include a process for assigning a back-up trustee in the event you were unable or unwilling to carry out your duties.

 

[isisdave]

First, it isn't clear what sister wants to happen to the proceeds from the sale of the house. Are they to be for the benefit of the daughter, doled out as you see fit? Or according to some schedule? Or are they for you, and daughter is on her own?

Second, sis is only 62. Unless her death is expected sooner for some reason, she might live 20+ years more, by which time lots of things might have changed. Daughter might have gotten wiser or moved out, or you (FREE866) might have predeceased sister. What then?

Third, what would happen if sis became disabled or mentally incapacitated long before dying (to the point where SHE couldn't maintain the house either). Then what?

IANAL, but to me all this is saying "trust" and maybe "special needs trust", although it's not clear if the daughter has an actual mental health issue, or is just an irresponsible 22-year-old. We all know people of that age who "grow out of it" at about age 27 or so. Of course if that happened, the will could be changed if sis is still competent.

 

[FREE866]

First, it isn't clear what sister wants to happen to the proceeds from the sale of the house. Are they to be for the benefit of the daughter, doled out as you see fit? Or according to some schedule? Or are they for you, and daughter is on her own?

Second, sis is only 62. Unless her death is expected sooner for some reason, she might live 20+ years more, by which time lots of things might have changed. Daughter might have gotten wiser or moved out, or you (FREE866) might have predeceased sister. What then?

Third, what would happen if sis became disabled or mentally incapacitated long before dying (to the point where SHE couldn't maintain the house either). Then what?

IANAL, but to me all this is saying "trust" and maybe "special needs trust", although it's not clear if the daughter has an actual mental health issue, or is just an irresponsible 22-year-old. We all know people of that age who "grow out of it" at about age 27 or so. Of course if that happened, the will could be changed if sis is still competent.

Good questions.


My sister, if she dies, does not want the daughter to have direct access to any funds as the daughter has demonstrated she is incredibly irresponsible. If there is an actual "medical diagnosis" at this stage we don't know as the daughter refuses to see a psychiatrist, graduated from high school 5 years ago and refuses to work. Nor does she want the daughter to live in the house alone as the house would just dilapidate.



So, at this point, she doesn't want to assume daughter will "grow out of it"

She would want house sold, have me receive the proceeds and set her up with a 1 BR rental apartment and give her an allowance for monthly expenses.

 

[pb4uski]

How long would the proceeds from sale of the house and whatever other assets that your sister has last to pay for rent for a 1 bdrm as per and allowance?

If not a long time will you be saddled with supporting your niece?

Is niece's bad behavior being enabled?

 

[FREE866]

How long would the proceeds from sale of the house and whatever other assets that your sister has last to pay for rent for a 1 bdrm as per and allowance?

If not a long time will you be saddled with supporting your niece?

Is niece's bad behavior being enabled?

My sister has another daughter who IS responsible and is now the beneficiary of 100% of my sister's brokerage accounts so there is money there to help, and yes I have money. So in the event it takes awhile for house to be sold there's cash to support her.


Her bad behavior has always been and yes still is enabled. It's a sad situation on numerous levels


and to your first question..sorry....at some point she will have to work to support herself...when she "wakes up" is anyones guess.

 

[GrayHare]

From what I've observed elsewhere, the longer someone is in non-work mode, the less likely they will willingly get a job. A psych eval might make sense, screening for depression, etc. Someone in their 20s still has time to turn their life around.

 

[Sunset]

From what I've observed elsewhere, the longer someone is in non-work mode, the less likely they will willingly get a job. A psych eval might make sense, screening for depression, etc. Someone in their 20s still has time to turn their life around.

+1

I've seen it where a person quit work, lived with parents for over 20 years until they died... sad really, a wasted life.