Protecting the financially incompetent

[1finngal]

What is the name of your state? Massachusetts
Our mother recently passed (9/2018). In her will, she set up a trust account for my one brother (now 59), for his protection. He is disabled, lives on apron. $1300/mo., is emotionally immature, and financially incompetent. Essentially, he has 'sucker' written on his forehead. He has filed bankruptcy twice, and had at least one vehicle repo'ed because he was never really qualified to purchase it, as he is frequently taken advantage of by unscrupulous salespeople and scammers. He has been scammed with threats of being arrested for nonpayment of loans he never made, and makes stupid purchases in the hopes his chances are improved of winning sweepstakes and lotteries. Since learning he has a sum of money in a trust, it is burning a hole in his pocket. He has been shopping for a new car, which he cannot afford, and of course, the dealer is more than happy to sell it to him. How can we protect him and his assets without actually trying to declare him financially incompetent? How do we protect him against these unscrupulous, greedy, so-called business people?

 

[quincy]

There is not much you can do.

 

[xylene]

How can we protect him and his assets without actually trying to declare him financially incompetent?

Why are you looking to avoid that?

You state plainly

. He is disabled, lives on apron. $1300/mo., is emotionally immature, and financially incompetent.

 

[Shadowbunny]

What is the name of your state? Massachusetts
Our mother recently passed (9/2018). In her will, she set up a trust account for my one brother (now 59), for his protection. He is disabled, lives on apron. $1300/mo., is emotionally immature, and financially incompetent. Essentially, he has 'sucker' written on his forehead. He has filed bankruptcy twice, and had at least one vehicle repo'ed because he was never really qualified to purchase it, as he is frequently taken advantage of by unscrupulous salespeople and scammers. He has been scammed with threats of being arrested for nonpayment of loans he never made, and makes stupid purchases in the hopes his chances are improved of winning sweepstakes and lotteries. Since learning he has a sum of money in a trust, it is burning a hole in his pocket. He has been shopping for a new car, which he cannot afford, and of course, the dealer is more than happy to sell it to him. How can we protect him and his assets without actually trying to declare him financially incompetent? How do we protect him against these unscrupulous, greedy, so-called business people?

I understand that you're not happy, but a salesperson doing his job by selling doesn't necessarily make them unscrupulous or greedy. Your brother shows up, says "I want to buy this car" and writes a check (or is approved for the loan). That is NOT the salesperson's fault -- they are not in a position to say "I'm sorry, you can't have this car." Businesses are there to make money so the owners, employees, stockholders, etc have money to live on. That doesn't mean they're greedy.

Now, the scammers are a different story -- the world would be better off without them.

Why don't you want to have him declared incompetent if you believe he is?

 

[Zigner]

Making financial decisions that another does not agree with, even if those financial decisions end up being "poor" or detrimental, does not necessarily equate to financial incompetence.

What is the nature of your brother's disability?

 

[1finngal]

Disability ~ My mother believes he was harmed or dropped during birth. Of course, we'll never know, since they knocked her out, as was the custom back in the day. Years later, we found our her obstetrician was a drunk. The left side of the body affects the right side of the body. The right side of his body is underdeveloped as compared to his left side. Although he graduated HS, he was held back a year, I think in 2nd or 3rd grade. He's been on seizure medication, dilantin, since he was a teen, at least. There was a time where he showed some improvement, but as he gets older, he seems to be digressing, as far as emotional maturity. He has the maturity level of a 13-yr-old. His world is Harry Potter and fantasy movies. He has never lived on his own, currently living with his school friend and his mother. When she passes (she must be getting on late 70's or early 80's), he has no idea where he will live, nor does he even think about it.

I don't see how he could qualify for this car he wants, except he knows he has money in a trust fund that was set up for him. I mean, really, he pays $400/mo for his rent, plus his auto insurance is high since he keeps having accidents. He has no savings. He pays an exorbitant amount for his cell phone and internet, neither of which he uses much. He never considered that this car he "fell in love with" comes with only a 30-day warranty, will have additional fees added to the total cost (registration, taxes), his insurance will increase, and he has no savings in case of emergencies. He never goes anywhere! He doesn't need a new car. He has one that runs one; it's just not so pretty anymore. There's only $18K in his trust fund. I feel it would be a violation of our mother's wishes to let him make this purchase.

Does this sound like a mature adult?! Remember, he's 59 years old! ~
Hi (to me), I talked to (sister 1) already about this 2015 Rav4 (that I test drove two days ago) and I really love it!!!
It's in great condition, no rust and under 100,000 miles (most likely the last car I'll ever need too)!!! It's $15,535.94 and they'll do everything at the Prime Toyota dealership, so I won't need to go the registry! I put some money down (so they'll hold it for me)!!!
(brother 1) and (sister 2) approves, now I'm trying to get your approval. Please say yes!!! Like in "Chitty Chitty Bang Bang"(Baron Vonberg's saying,"I want that car")!!!

 

[quincy]

Have you considered looking into guardianship?

 

[1finngal]

Well, in tandem with the trust fund, sister 1 and myself are the guardians of his trust. His disability check i deposited to his account and he has access to that. My concern is, should the car dealer talk my brother into signing a contract, which we, as family, know he cannot afford, can it be enforced? Is it legal?

 

[quincy]

Well, in tandem with the trust fund, sister 1 and myself are the guardians of his trust. His disability check i deposited to his account and he has access to that. My concern is, should the car dealer talk my brother into signing a contract, which we, as family, know he cannot afford, can it be enforced? Is it legal?

If he is not legally incompetent then, yes, the contract he signs is valid and can be enforced.

 

[1finngal]

But, they can't demand money from his trust, can they? I'm trying together a handle on the legalities.

 

[quincy]

But, they can't demand money from his trust, can they? I'm trying together a handle on the legalities.

What sort of trust is set up for your brother?

The reputable car dealer should run a credit check to determine if your brother qualifies for a loan. If his income does not support a loan, a reputable lender will not approve a loan.

Are you afraid the car dealer or the lender are not reputable? If so, either you or your sister could accompany him to the dealer.

 

[1finngal]

My sister did accompany him to the dealer. My brother confessed to me that he put money down to hold the car. He did not tell my sister this. Nether did the saleswoman. When my sister questioned my brother, he said he gave $20 for them to hold the car. Really?! I've never heard that $20 would hold a car for anyone! I understand that the salespeople only have to get him qualified, and that's all they care about. I suspect he probably told them he has a trust fund. I can see them urging him to sign the contract and telling him to not worry about the consequences. Like I said, he's bought cars in the past, couldn't keep up with the payments, and had them repo'ed.

 

[1finngal]

I don't have it in front of me, but it's a trust that he cannot touch unless me or my sister approve the removal of funds from it.

 

[1finngal]

I have no faith in their formulas for qualifying people for loan, either. Look what they did prior to the housing bust of 2008. You could get a house loan if you had no job, no income.

 

[quincy]

I don't have it in front of me, but it's a trust that he cannot touch unless me or my sister approve the removal of funds from it.

If that is the case, creditors should not be able to touch the funds in the trust either.

Unless/until your brother is declared incompetent, there is nothing you or your sister can do to protect him from himself.