[WSBAPT] Bank not recognizing Administrator , wants "Successor in Interest"

[Nicholas Pleasants]

Hi Peter,
I have run in to your problem several times, and have a solution. But first, before we attack the bank, let me say that the bank may actually be following its internal procedures. For loan modifications/assumptions, they only want to deal with the person who is inheriting the house: the successor in interest. Let’s say there was a Will that left the house to a specific person. Then the bank does not want to deal with the executor, they want to deal directly with the beneficiary.
In your case, there is a bit of a cloud on the title from the bank’s perspective because it was decedent’s separate property before marriage. Presumably it is now a community asset, but the bank is in a tough position because they do not know the character of the property. It’s not the bank’s fault decedent never bothered to add his wife to title or sign a community property agreement, so they have no way to know if it is community property. This is what the bank is trying to figure out. If there are no issues with creditors or other beneficiaries, then surviving spouse can simply deed the house to herself by PR/Administrator Deed. Once you have the deed recorded, you can forward it to the bank to demonstrate that surviving spouse is the successor in interest per the PR deed. A bit wonky, but that should allow the bank to talk to your client.
Also see 12 USC 1701j-3 regarding the transfer of the house to the spouse not triggering due on sale clause, and presumably surviving spouse can just assume the loan at the current rates. https://www.law.cornell.edu/uscode/text/12/1701j-3
Best,
Nick
Nicholas Pleasants
Pleasants Law Firm, P.S.
2300 130th Ave NE, Suite A-101
Bellevue, WA 98005-1755
(425) 615-7070 tel/fax
nick at pleasantslaw.com<mailto:nick at pleasantslaw.com>
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From: <wsbapt-bounces at lists.wsbarppt.com> on behalf of "Diane J. Kiepe" <DJKiepe at depdslaw.com>
Reply-To: WSBA Probate & Trust Listserv <wsbapt at lists.wsbarppt.com>
Date: Thursday, August 13, 2020 at 4:13 PM
To: WSBA Probate & Trust Listserv <wsbapt at lists.wsbarppt.com>
Subject: Re: [WSBAPT] Bank not recognizing Administrator , wants "Successor in Interest"

Peter,

Institutions can be so frustrating.  Is the spouse by chance the beneficiary of the home and will he be able to afford it?  It doesn’t sound at all like the bank is operating in a way they are allowed however I have learned the hard way that those preprinted documents (especially if older) have some odd provisions.  I would be tempted to have another bank call for a pay-off number and refinance elsewhere – from a practical perspective this may get you to where you need to be.  I can’t imagine that a bank wouldn’t speak to another bank.

Second thought is to have client carry in a threatening letter from you with citations to RCW indicating what an Administrator has the power to do if time permits but it sounds like things are moving close to foreclosure. I would send copies to the home office, attention: legal and I would mention any proper citations to attorney fees, etc. etc.

Third thought is a TEDRA Action and set for hearing on the merits for the 20 days or whatever it is and maybe see if you can get a temporary injunction to delay foreclosure.  There is no reason for the bank to not recognize the letters of admin…..unless someone out there has something to share that I have not come across.

I would love to hear how it works out.  Again, I can not think of any legal authority that can allow the bank to make this demand –


Diane J. Kiepe

Diane J. Kiepe
Douglas Eden
717 W. Sprague Ave.
Suite 1500
Spokane, WA  99201
djkiepe at depdslaw.com<mailto:djkiepe at depdslaw.com>
509-455-5300

From: wsbapt-bounces at lists.wsbarppt.com <wsbapt-bounces at lists.wsbarppt.com> On Behalf Of Peter D. Haroldson
Sent: Thursday, August 13, 2020 11:43 AM
To: wsbapt at lists.wsbarppt.com
Subject: [WSBAPT] Bank not recognizing Administrator , wants "Successor in Interest"

Administrator of intestate estate (surviving spouse) with non-intervention powers trying to do loan modification for estate real property (purchased prior to marriage, if that matters) to avoid foreclosure.

Bank has copy of order appointing and copy of letters of admin, acknowledges he is administrator, but refuses to discuss the matter with him or transact a modification until he “gets his status changed to successor in interest”.

Any insight as to how to deal with this?

Peter D. Haroldson
Torres & Haroldson, PLLC
PO BOX 530
Maple Valley, WA 98038
Email: peter at torresharoldson.com<mailto:peter at torresharoldson.com>
Facebook: fb.me/torresharoldson<https://fb.me/torresharoldson>
Phone: 425.458.3170

Our office is located at 22520 SE 218th Street, Maple Valley WA 98038.  Please send mail to PO BOX.

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