[WSBAPT] Separate Property of deceased spouse/minor

Wed Aug 10 09:59:38 PDT 2016

Dear Krista:
Here is how I view the title and mortgage interests.

1)      The title is currently in husband’s name evidently. Through the probate the PR will convey that title to the heir, who may in this case be the surviving spouse or the surviving spouse and her child, depending upon the characterization (i. e. separate or community) of the real estate.

2)      The mortgage interest is an encumbrance on the property. The property is security for the promissory note executed by the husband when he purchased the property and used a lender’s funds in that purchase. That lender does not hold title but clouds title with a financial interest. So long as the terms of the loan are honored the lender’s encumbrance remains just that, a notification to all who would inquire that they have this financial interest in the property. When or if the surviving wife sells the lender shall surely take whatever proceeds of the sale are warranted to satisfy the underlying encumbrance.
Pretty wordy, but that is how I get through the analysis.

Yours truly,

Kerry A. Richards
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From: wsbapt-bounces at lists.wsbarppt.com [mailto:wsbapt-bounces at lists.wsbarppt.com] On Behalf Of Krista MacLaren
Sent: Wednesday, August 10, 2016 9:39 AM
To: Heather deVrieze; Maureen Wickert
Cc: wsba probate & trust
Subject: Re: [WSBAPT] Separate Property of deceased spouse/minor

Thank you both so much, your comments are very helpful.  Could you possibly explain whether a deed and the financing need to match?  I am confused by whether, so long as the rights of the minor are addressed, it is appropriate to deed the house to the surviving spouse while it is financed in husband's name?

Krista
On Aug 10, 2016, at 9:04 AM, Heather deVrieze <heatherd at westseattlelaw.com<mailto:heatherd at westseattlelaw.com>> wrote:

I agree with Maureen’s comments, but would add that a GAL is likely required, and would give mother the opportunity to take a stronger position regarding community vs. separate property and get her plan for the funds (UTMA may very well be acceptable depending on the amount of money). A family support award cannot be made without the appointment of a GAL for a minor. Look at 11.76.080 (2). A GAL is required for an order granting nonintervention powers when there are minors involved, unless the surviving spouse is the sole beneficiary under the terms of a will and the minor is the child of both the deceased and the surviving spouse.

As a practical matter, unless the child was nearly 18, delay probably doesn’t simplify, but complicates the situation. I would look at why the property and mortgage was in deceased name alone, how were payments made, was it commingled such that it should now be characterized as CP? If there is only CP, no distribution to minor, GAL can sign off on characterization of property and you can leave the surviving spouse with a clean slate.

Heather

Heather S. de Vrieze
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From: wsbapt-bounces at lists.wsbarppt.com<mailto:wsbapt-bounces at lists.wsbarppt.com> [mailto:wsbapt-bounces at lists.wsbarppt.com] On Behalf Of Krista MacLaren
Sent: Tuesday, August 09, 2016 9:16 PM
To: wsba probate & trust <wsbapt at lists.wsbarppt.com<mailto:wsbapt at lists.wsbarppt.com>>
Subject: [WSBAPT] Separate Property of deceased spouse/minor

Listmates,

Decedent H died without a will.  W and 5 y.o. child survive.   No prior marriages or other children for either spouse.  The house they live(d) in was decedent’s separate property, and there is a mortgage on it in H’s name.  I am wondering several things: 1)  Does GAL have to be appointed for minor child when child’s mother will serve as PR? 2) If W wants to remain in the house, what is her best course of action?  She works, but I don’t know if she would independently qualify for mortgage.  Should she first see if she could obtain a loan to finance the house herself, and if she can't, just try to keep making payments without notifying loan company?  And what would be appropriate as to the deed from the estate?  Can she deed house to herself a) when the loan is not in her name, and b) when minor child is entitled to a share of decedent’s estate (there may be other assets to pay share to minor child).  3) Can share for minor child be placed in an UTMA or must a guardianship be set up?  4) Would family support claim change any of this?

Since other assets are POD accounts, it may not be necessary to have a probate at all if she is just continuing to pay mortgage without transferring ownership, but that doesn’t seem very secure for her.

I appreciate any guidance.

Thank you,

Krista

Krista J. MacLaren
Attorney at Law
Northgate Executive Center II
9725 3rd Ave NE, Suite 600
Seattle, WA 98115
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