[WSBAPT] Separate Property of deceased spouse/minor

Thu Aug 11 18:19:16 PDT 2016

I haven’t had any problem in just telling the client they may get a due on sale letter from the lender, and wait for the letter, bring it to me and I will send my 12 U.S. Code § 1701j–3(d)(6) letter.  It seems to work fine.  The law is the law. Why notify them first.?

Josh Grant

From: Paul Grant 
Sent: Thursday, August 11, 2016 4:57 PM
To: WSBA Probate & Trust Listserv 
Subject: Re: [WSBAPT] Separate Property of deceased spouse/minor

I agree with Maureen's cite of code and would only add that upon transfer through the probate you need to notify the lender of the transfer.  Cite the appropriate code that the due-on-sale clause is not an option and I send a certified letter to them.  They will respond with paperwork so inform your client to expect a response but to bring it to you and not to begin filling it out.   

Lastly, be sure to look at the mortgage contract!  It will give you guidance to notification and any other potential requirements when a mortgagee dies.

Paul H. Grant - JD, LL.M

Planning with Purpose, Inc
Lynnwood, WA 98036
425-939-9948
www.planningwithpurposeinc.com

Estate Planning. Business Planning. Wealth Succession.

On Wed, Aug 10, 2016 at 9:44 AM, Maureen Wickert <wickertlaw at comcast.net> wrote:

  The deed to the surviving spouse is a conveyance of a transfer. So 12 U.S. Code § 1701j–3(d)(6) applies to such transfer as exempt from the mortgage’s due on sale clause. 

  Very truly yours,

  Maureen A. Wickert, Attorney at Law

  14900 Interurban Avenue South, Suite 255

          Tukwila, WA 98168

         Phone: 206-859-5502

           Fax: 206-260-9005

       www.wickertlawoffice.com

         wickertlaw at comcast.net

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  From: Krista MacLaren [mailto:kjm.inc at mac.com] 
  Sent: August 10, 2016 9:39
  To: Heather deVrieze <heatherd at westseattlelaw.com>; Maureen Wickert <wickertlaw at comcast.net>
  Cc: Krista J. MacLaren <kjm.inc at mac.com>; wsba probate & trust <wsbapt at lists.wsbarppt.com>
  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> 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
    Attorney-at-Law

    <image002.jpg>

    3909 California Avenue SW

    Seattle, WA 98116-3705                         

    (206)938-5500

    heatherd at westseattlelaw.com

    www.westseattlelaw.com

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    From: 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>
    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
    (206)523-6116
    kjm.inc at mac.com

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