I am executor of the estate for my step-dad who I care for and whose house is in the name of the trust. I live in the house and have for 20 years with my step-dad. There are 5 beneficiaries. There are some different ideas on how the house should be sold. One wants to pour money into it to fix it up first. Another feels it should be sold as is. And another has taken interest in the house as an investment and offered to me to buy the other beneficiaries out. I think this is going to get ugly as one of the beneficiaries is a bad apple so-to-speak and already causing problems.
How should I handle this? What should be done or what is the best course of action when the time comes?
You'll need to get a certified date-of-death appraisal of the house. If one of the beneficiaries wants to buy the others out, that will help determine the fair market value. (If someone wants to pour money into fixing it up, they can buy out everyone else, pour in their own money, and then flip it.) There will be taxes involved, to be paid for by either the Trust or by the beneficiaries. The lawyer will guide you on this and other matters. The lawyer will also be valuable because you can cite him or her when others argues about doing things a different way, And the attorney gets paid for by the Trust, not out of your own pocket.
I hope everyone will be respectful of your role and your decisions when the time comes.
When Twinkie brings it up, you adopt a sincere and businesslike facial expression. "Twinkie, stepdad appointed me to be in charge of his estate and his trust. I'll be handling it to the letter of the law with the help of an estate attorney. All dealings will be run through the lawyer's office, and when the time comes, you'll be hearing from both of us."
Period. Stop.
Twinkie: "But - but - "
You: "That's all I have to say at this time. It was nice talking to you! Bye!"
Don't even think of handling a problem like this without an attorney. It will be money well spent when dealing with Twinkie, Moon Pie, Snickers and Sour Ball.
If it is decided to sell the house, sell it "as is". You have enough on your plate to go through without the hassle of updating the house and dealing with a half dozen of opinions on how it should be updated (which could take months), only for the new owner to rip it out if they prefer something else.
If the person who wants to use the house as an investment, thus buy out the others, have the home professionally appraised by a license Appraiser to get the market value of the house. The Elder Law attorney may or may not think this is a good idea to buy out from the other beneficiaries.
When my Dad was ready to move into senior living, he asked me to sell the house (I was a Realtor) and I went with the "as is", and had it appraised. It sold quickly, and the funds were used for Dad's care.
Other beneficiaries have ZERO to say about it. They will receive the portion allotted by the parent's WILL or by the STATE.
That's the end of it, and it should be the end of discussion. IF you are the said Executor or the said Administrator let ALL beneficiaries know they will hear from you by legal mail according to the law. GET AN ATTORNEY and do this with the attorney's help. At that point every problem they make takes up their own inheritance money to settle.
What exactly does the Trust say should be done with the house? Does it say the five beneficiaries will become co-owners, in which case they get to decide how to sell it, or does it say that the house should be sold and the money distributed to the beneficiaries, in which case the Trustee needs to do that? The Trustee needs to do exactly what the Trust says. Do you have a copy of the Trust document?
Yes, step-dad is still alive. Yes, conversation is premature and I'm frustrated that the bad apple brother tried to open up discussion about it some time back. I told him we will discuss it when the time comes. I'm just trying to take some steps in educating myself a bit as the time could be approaching soon depending on step-dad's declining health and I don't want to be totally in the dark if possible.
Thank you for your help.
...They can bump the trustee / executor off? Well, I hope it doesn't come to that, but if so, that's fine because the beneficiary named as second trustee is my step-dad's son. He will do what I'm doing anyway.