Trust/ Wills/ Power of Attorneys

K

KingSobieski

Veteran XX
I got a question.

My uncle is upside down on medical debts and has no hope of ever paying these debts back. A few years ago, he had bought an old family house in the mountains. My mother had bought out the other shares from the inheritors and had a clean title when she sold it to him. She could have kept the house in her name but she was afraid of liability, having him live in a house that she owns, in case he burnt it down or something. This is a 3 generation property.

When he passes, I assume the house and property will be sold to settle his debts.

Can I purchase the house back from him and let him to continue living in that house until his death? Of course, knowing I am doing this in order to avoid paying his debts back. Is that legal? There's no mortgage or anything. The property + house is maybe worth a combined $35k. I could pay him fair market value. I think otherwise, if he dies in possession of the house + the debt, then the house must be sold on the public market by the insurance company?

Could he file Chapter 7 or 13 bankruptcy and if so, can the debtors seize a person's home?

Any insight into the differences between Wills or Trusts or Power of Attorneys? What's the best way to prepare someone's estate who has massive medical debts?

He has entrusted me in his Will so far, which includes the house and his two cars. But with his current medical debts (he's kept his ill wife in hospitals/hospices/rehab/etc for 9 months) his estate is insolvent. He's a Gulf War veteran and lives off his army benefits.
 
Have him put the house in a trust, put you as a member of the trust. WHen he dies it goes to you. He is separate from teh trust so the trust doesn't assume his debt and you dont get a gnarly inheritance tax
 
Maybe around 80yrs old now. Coal country, heading towards W Virginia. Vinyl siding, metal roof, square foot print, like 40x40. Built out of cedar. Its a 3 bedroom, 1 bath, front + back porch, dine in kitchen, detached concrete block shed, parking pad, and like, 10 acres of hillside but has about 1 acre of flat land and fresh water stream, + a well but is connected to city water now.

Pretty much prime real estate to survive the apocalypse.

It's very livable if you don't mind a 45min drive to the nearest grocery store.

Got some new kitchen appliances/cabinets/flooring/water heater/ furnace/ ADA bathroom that all I put in.

It needs a re-wire but does have a breaker panel.

I got a hand railing for the front + back steps I'm going to put in this week to help the old man out a little.
 
Wow, thanks Juggs, you're absolutely right.

We need to draft an irrevocable trust.

At least I now know what to ask when we go visit the attorney. I'm not worried about estate taxes on the property and a trust may avoid inheritance tax and provide protection from creditors who may want to seize the property.
 
I'm moving in to a house built in 1900 soon. It has a bit of a tilt but it's in a nice neighborhood with a sunny front yard.

$2200 a month :ugh:
 
Anything pre-war is going to be tilted a bit. If you think of movement as annually 1/64" you'll get 1" in 64years 2" in 128years.

I just pointed up a rubble stone foundation on an old house on friday. 2 story brick. Had trees growing out of it. Old girl just needs some love. Still going strong as ever before. Chopped the trees out with a mattock and grout bagged the stones.

Mine's a 1919. I bought it end of 2016 for 78K. Solid brick. I paid it off and now my utility/taxes/insurance average out to $600/month. I auto deposit $700 into a checking account at the end of the month and the bills draw from that account. Should always be positive.

I still have the insurance coverage I was required to have when I had the mortgage. Now the insurance rates are going crazy and I don't see a benefit. Like $1,500/year that I'll never see again. We don't live in a disaster area and the house is going on in age just fine and will last another 100 years. Now that I'm paid off, I'll make a claim for the roof and then once it's replaced, I'll cancel it. I'll take the insurance payment and put it into it's own account and self-insure myself.

I make $400-500/week working part time from 9-2 as a handyman helper and volunteer work from 3-6 at Salvation Army after school program with my kids. I help kids with their homework and then play basketball.
 
my house is being built atm, should be ready before the end of the year

900k NZ

not even particularly big...3 br, barely any yard, no garage :skull:

will be nice though :)
 
Congrats :D I'd love to build a house some day.

I got a postage stamp sized yard. I could cut it with a pair of scissors if I had to.
 
i mean, the best thing you can do is contact an estate planning attorney, they will tell you what is best most likely.

we have a 3 generation house in California where my relative recently passed. Property tax bill used to be grandfathered in, but I guess CA changed the law a few years back so you can no longer do that...due to the prime location, it would probably have like 50k/year in property taxes that no one in our family can afford (currently is like 4k/year), so the house will have to be sold (and probably torn down to build one of those mcmansions on). its a real shame - been in the family since the 1920s
 
Buying the house will certainly be avoiding your dad losing the value altogether and I think it's a great idea if you can swing it. The entire medical industry is built on large numbers of bad debts so they've written that off long ago.

You don't need to set up any legal trusts, it's a simple private transaction.
 
He doesn't need to file bankruptcy for medical debt unless they're suing him. But they never do that. (I used to be a bankruptcy consultant)

And yes buying the house to avoid paying medical debt is both legal and moral. You can arrange your affairs to your own benefit in this country
 
The only legal thing I recommend is a living will where you have p. o. a. to manage his affairs when he goes incompetent
 
KingSobieski said:
Maybe around 80yrs old now. Coal country, heading towards W Virginia. Vinyl siding, metal roof, square foot print, like 40x40. Built out of cedar. Its a 3 bedroom, 1 bath, front + back porch, dine in kitchen, detached concrete block shed, parking pad, and like, 10 acres of hillside but has about 1 acre of flat land and fresh water stream, + a well but is connected to city water now.

Pretty much prime real estate to survive the apocalypse.

It's very livable if you don't mind a 45min drive to the nearest grocery store.

Got some new kitchen appliances/cabinets/flooring/water heater/ furnace/ ADA bathroom that all I put in.

It needs a re-wire but does have a breaker panel.

I got a hand railing for the front + back steps I'm going to put in this week to help the old man out a little.
Click to expand...

Sounds like a nice BOL in a SHTF scenario. All you need is to fix her up a bit and start growing some veggies, build a chicken coop etc.
 
Juggs is probably right. Quit claim it into a irrevocable trust, or just to yourself. When he passes the bill collectors will want fair market value depending on the amount of time passed.
 
Irrevocable trust seems to offer protection from debt collectors. When I visit him next time, I will see if we can find a attorney in the area that can help. I don't mind paying a little fee to get the correct documents written up and secured.
 
You must log in or register to reply here.
Back
Top