Can we be sued?

[OhReally]

What is the name of your state (only U.S. law)? California

Good Evening.

My father passed away a couple months ago and we are trying to settle his estate. He had a living trust and a decent amount of money that shall be split between my siblings and myself. However, there is an issue about the home he lived in. It was a manufactured home that was on his brother's property but there is still money owed on the home. My father bought the home and the loan was in his and my mother's name, but my mother passed away a few years ago.

The home was not in the trust and I am wondering what we can do with it. His brother doesn't care what we do with it. Do we have to pay off the loan on it or can we just not? I was under the impression that we have to settle the debt with money in the trust buy my sister said we do not, that we don't have to pay it and the bank that holds the loan will just take it back. Is this accurate? And if that is the case, can we be sued for what is still owed later on? My aunt and myself are the trustees to the trust so I just wanted to get a little direction on this. My sister said she spoke to a lawyer and that the bank can just take it back and that will be the end of it. That just seems to simple to me, I feel since it was my father's debt and there is plenty of money in the trust, that the bank will want what they are legally owed by the loan contract.

 

[LdiJ]

What is the name of your state (only U.S. law)? California

Good Evening.

My father passed away a couple months ago and we are trying to settle his estate. He had a living trust and a decent amount of money that shall be split between my siblings and myself. However, there is an issue about the home he lived in. It was a manufactured home that was on his brother's property but there is still money owed on the home. My father bought the home and the loan was in his and my mother's name, but my mother passed away a few years ago.

The home was not in the trust and I am wondering what we can do with it. His brother doesn't care what we do with it. Do we have to pay off the loan on it or can we just not? I was under the impression that we have to settle the debt with money in the trust buy my sister said we do not, that we don't have to pay it and the bank that holds the loan will just take it back. Is this accurate? And if that is the case, can we be sued for what is still owed later on? My aunt and myself are the trustees to the trust so I just wanted to get a little direction on this. My sister said she spoke to a lawyer and that the bank can just take it back and that will be the end of it. That just seems to simple to me, I feel since it was my father's debt and there is plenty of money in the trust, that the bank will want what they are legally owed by the loan contract.

Your father's estate is responsible for your father's debts. The money in the trust is not part of the estate and passes to the beneficiaries outside of the estate.

Whoever is the administrator/executor of his estate (which is not the trustees of the trust) is responsible to handle the estate in a manner that maximizes its value so that any creditors get paid or get paid to the extent that its possible to get paid. The house should really be sold to maximize what the lender will get back.

If its not possible to sell the house without putting significant money into it then of course just let it go back to the lender.