[WSBAPT] Does a Transfer to JTWROS trigger due on sale?

[Heather deVrieze]

I don't see any way to get this property to the Church without triggering the due on sale clause. Garn St. Germain does not protect non-relative beneficiaries at death, and an addition to title now, that is not family is likely to cause the bank to call the mortgage now.

Could some life insurance on client be purchased, payable to church to pay off mortgage when it is called? Then client can give house to Church in his Will.

Heather

Heather S. de Vrieze
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From: wsbapt-bounces at lists.wsbarppt.com [mailto:wsbapt-bounces at lists.wsbarppt.com] On Behalf Of jeffrey winter
Sent: Saturday, October 22, 2016 3:11 PM
To: WSBA Probate & Trust Listserv <wsbapt at lists.wsbarppt.com>
Subject: [WSBAPT] Does a Transfer to JTWROS trigger due on sale?


For those of you working on Saturday...



I have a client that would like to quit claim his house to his church (non profit corp) and himself as joint tenants with right of survivorship.  The house has an existing deed of trust, and the church holds a subordinated second deed of trust for some improvements the church has made to the house (the client has donated the use of the house for holding church services).



I understand that Garn St. Germaine protects transfers upon the death of a joint tenant from triggering due on sale clauses, but my concern is the front end of the transaction -- where the client creates the joint interest in the first place.



In reviewing the language prohibiting transfers of interest by the borrower on the underlying deed of trust, it appears to prohibit any transfer "the intent of which is the transfer of title by Borrower at a future date to a purchaser."  I'm not sure that would apply in this instance, although the church has been making payments on the house for some time, and would continue to do so in the event of the death of my client.



Any thoughts?



Thank you in advance....



Jeff Winter
Jeffrey D. Winter
Law Office of Jeffrey D. Winter, P.S.
604 North Main Street
Ellensburg, WA 98926
(509) 925-9600 tel.
(509) 925-9606 fax





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