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<p class="MsoNormal"><span style="font-size:11.0pt;color:#1F497D">Thank you also James. Appreciate the cite.<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:11.0pt;color:#1F497D"><o:p> </o:p></span></p>
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<p class="MsoNormal"><b><span style="font-size:10.0pt;font-family:"Tahoma","sans-serif"">From:</span></b><span style="font-size:10.0pt;font-family:"Tahoma","sans-serif""> wsbapt-bounces@lists.wsbarppt.com [mailto:wsbapt-bounces@lists.wsbarppt.com]
<b>On Behalf Of </b>James W. Spencer<br>
<b>Sent:</b> Thursday, November 15, 2018 10:34 AM<br>
<b>To:</b> WSBA Probate & Trust Listserv<br>
<b>Subject:</b> Re: [WSBAPT] House for surviving spouse<o:p></o:p></span></p>
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<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal" style="margin-bottom:12.0pt"><span style="font-size:11.0pt">Greetings Paige:<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:11.0pt">See 12 U.S. Code § 1701j–3(d) (part of the Garn-St. Germain Act):<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:11.0pt">(d) <u>Exemption of specified transfers or dispositions</u>. With respect to a real property loan secured by a lien on residential real property containing less than five dwelling units, including a lien on
the stock allocated to a dwelling unit in a cooperative housing corporation, or on a residential manufactured home, a lender may not exercise its option pursuant to a due-on-sale clause upon—<o:p></o:p></span></p>
<p class="MsoNormal" style="margin-left:.5in"><span style="font-size:11.0pt">(1) the creation of a lien or other encumbrance subordinate to the lender’s security instrument which does not relate to a transfer of rights of occupancy in the property;<o:p></o:p></span></p>
<p class="MsoNormal" style="margin-left:.5in"><span style="font-size:11.0pt">(2) the creation of a purchase money security interest for household appliances;<o:p></o:p></span></p>
<p class="MsoNormal" style="margin-left:.5in"><span style="font-size:11.0pt">(3) a transfer by devise, descent, or operation of law on the death of a joint tenant or tenant by the entirety;<o:p></o:p></span></p>
<p class="MsoNormal" style="margin-left:.5in"><span style="font-size:11.0pt">(4) the granting of a leasehold interest of three years or less not containing an option to purchase;<o:p></o:p></span></p>
<p class="MsoNormal" style="margin-left:.5in"><b><span style="font-size:11.0pt">(5) a transfer to a relative resulting from the death of a borrower;<o:p></o:p></span></b></p>
<p class="MsoNormal" style="margin-left:.5in"><b><span style="font-size:11.0pt">(6) a transfer where the spouse or children of the borrower become an owner of the property;<o:p></o:p></span></b></p>
<p class="MsoNormal" style="margin-left:.5in"><span style="font-size:11.0pt">(7) a transfer resulting from a decree of a dissolution of marriage, legal separation agreement, or from an incidental property settlement agreement, by which the spouse of the borrower
becomes an owner of the property;<o:p></o:p></span></p>
<p class="MsoNormal" style="margin-left:.5in"><span style="font-size:11.0pt">(8) a transfer into an inter vivos trust in which the borrower is and remains a beneficiary and which does not relate to a transfer of rights of occupancy in the property; or<o:p></o:p></span></p>
<p class="MsoNormal" style="margin-left:.5in"><span style="font-size:11.0pt">(9) any other transfer or disposition described in regulations prescribed by the Federal Home Loan Bank Board<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:11.0pt"><o:p> </o:p></span></p>
<p class="MsoNormal"><span style="font-size:11.0pt">Best wishes,<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:11.0pt">James<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:11.0pt"><o:p> </o:p></span></p>
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<p class="MsoNormal" style="background:white"><span style="font-size:11.0pt">James W. Spencer<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:11.0pt">Brothers & Henderson, P.S.<o:p></o:p></span></p>
<p class="MsoNormal" style="background:white"><span style="font-size:11.0pt">2722 Eastlake Avenue East, Suite 200<o:p></o:p></span></p>
<p class="MsoNormal" style="background:white"><span style="font-size:11.0pt">Seattle, Washington 98102<o:p></o:p></span></p>
<p class="MsoNormal" style="background:white"><span style="font-size:11.0pt">Phone: (206) 324-4300 x106<o:p></o:p></span></p>
<p class="MsoNormal" style="background:white"><span style="font-size:11.0pt;color:black">e-mail:
</span><span style="font-size:11.0pt"><a href="mailto:jamess@brothershenderson.com"><span style="color:blue">jamess@brothershenderson.com</span></a><o:p></o:p></span></p>
<p class="MsoNormal" style="background:white"><span style="font-size:11.0pt"><a href="http://www.brothershenderson.com/"><span style="color:blue">www.brothershenderson.com</span></a><o:p></o:p></span></p>
<p class="MsoNormal" style="background:white"><span style="font-size:11.0pt"><o:p> </o:p></span></p>
<p class="MsoNormal"><span style="font-size:11.0pt;color:black">The information transmitted in this e-mail message and attachments is attorney-client information, is privileged or confidential material and is intended only for the use of the individual or entity
named above. If you have received this transmission in error, immediately notify the sender by reply e-mail and permanently delete this transmission and all copies including attachments.</span><span style="font-size:11.0pt"><o:p></o:p></span></p>
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<p class="MsoNormal"><span style="font-size:11.0pt"><o:p> </o:p></span></p>
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<p class="MsoNormal"><b><span style="font-size:11.0pt">From:</span></b><span style="font-size:11.0pt"> wsbapt-bounces@lists.wsbarppt.com <wsbapt-bounces@lists.wsbarppt.com>
<b>On Behalf Of </b>Paige Buurstra<br>
<b>Sent:</b> Thursday, November 15, 2018 10:08 AM<br>
<b>To:</b> wsbapt@lists.wsbarppt.com<br>
<b>Subject:</b> [WSBAPT] House for surviving spouse<o:p></o:p></span></p>
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<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal"><span style="font-size:11.0pt">Hello all, <o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:11.0pt"><o:p> </o:p></span></p>
<p class="MsoNormal"><span style="font-size:11.0pt">I have a client who owns a home as his separate property. He is in his seventies and recently got remarried. He has 2 children from his first marriage. He wants to allow his current spouse to live in the home
for up to 5 years after he passes. There is still a mortgage on the home. Wife would be responsible for paying the mortgage. At the end of 5 years or when Wife decides to move out, He then wants surviving spouse to receive 20% and each child to receive 40%
of the equity. (this is not a taxable estate)<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:11.0pt"><o:p> </o:p></span></p>
<p class="MsoNormal"><span style="font-size:11.0pt">My first inclination is to create a living trust and transfer the house into the trust, including the period of years and ultimate disposition in the trust terms. However, my concern is that at the time of
client’s death, we publish notice to creditors, the mortgage company is on notice that client is deceased and calls note due so that house must be refinanced or sold. Children will not want to be on the hook for a mortgage that wife is obligated to pay. Mortgage
co would not likely lend to the trust. Essentially, lender could force the sale right away, thwarting the purpose of the trust.
<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:11.0pt"><o:p> </o:p></span></p>
<p class="MsoNormal"><span style="font-size:11.0pt">Has anyone run into this or have any other ideas or suggesetions? <o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:11.0pt"><o:p> </o:p></span></p>
<p class="MsoNormal"><span style="font-size:11.0pt">Thanks,<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:11.0pt">Paige Buurstra<o:p></o:p></span></p>
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