Estate Home but With Girlfriend Listed as Permanent Tenant

[jook]

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

I'm the personal rep for my father's estate ( basically a home, the land home sits on and car ). So if a creditor comes out of the woodwork, there aren't many options to pay, other than selling the home if it's anything substantial.

Question is around this seemingly strange case. In the Will it states the son gets the real property but it subject to the following condition listed in the will :

This is word for word "the ownership of said residence is subject to Jane Doe having the right to continue to occupy the property, as long as she resides in the state, pays bills,,,,etc...."

This Jane Doe is the Girlfriend of the deceased Father. So as long as she lives in the home, can anything be done to this property, as it's subject to her residency? Seems like it should NOT be part of the estate since it's got this clause on it, or at least it seems as though it couldn't be sold to pay off creditors, as it's subject to the girlfriends residence?

Anyone know about this. Who wins, the Will's wishes, or the Creditor's claim on the property?What is the name of your state (only U.S. law)?

 

[anteater]

Legitimate creditors get paid before any bequests.

 

[jook]

Legitimate creditors get paid before any bequests.

Ok, so the Estate owns the property outright no matter what the will states.
Probate determines if any creditors have legit claims. If so, the property could be sold ( based on probate proceedings ).
Once the estate is closed, then the Will kicks in ( the bequest of property ). At that time, the "girlfriend clause" kicks in, but is irrelevant until the estate is closed by Probate.

Does that summarize it correctly?
Thanks.

 

[OHRoadwarrior]

Other answers aside, it seems to say that in order for son to keep ownership, GF gets to live there. If property is being sold for debt, son is not getting ownership, so GF clause does not matter.

 

[anteater]

Ok, so the Estate owns the property outright no matter what the will states.

I would not put it that way, but close enough.

Probate determines if any creditors have legit claims. If so, the property could be sold ( based on probate proceedings ).
Once the estate is closed, then the Will kicks in ( the bequest of property ). At that time, the "girlfriend clause" kicks in, but is irrelevant until the estate is closed by Probate.

Well, not exactly. Part of the probate process is the personal representative distributing the estate's assets according to the will's provisions after the personal representative fulfills his/her other duties, most prominently paying legitimate creditor claims. Think of it this way: an aspect of "closing" the estate is the release of the personal representative from his/her legal obligations. If the personal representative is released from those obligations without distributing the estate's remaining assets, then there is no one with legal authority to distribute the assets. Probate would have to be re-opened.

If it is not necessary to sell the property in order to fulfill the estate's financial obligations, then you would need to prepare a deed transferring ownership - including the girlfriend's life estate.

I would suggest that you retain a local probate attorney, even if it is only on an hourly fee basis to help you over the rough spots.

 

[jook]

If it is not necessary to sell the property in order to fulfill the estate's financial obligations, then you would need to prepare a deed transferring ownership - including the girlfriend's life estate.

Transferring ownership to "whom"? Sounds like a life estate in this case would transfer immediate ownership to GF?

The will says as long as GF "resides in state" vs. as long as GV lives. Is this also a form of a life estate?

A life estate was not the "intent" behind the GF clause, so not quite sure about this one. Is a "life estate" inferred in the wording above, or would it have to be explicitly spelled out, as in mentioning the term "life estate"? The will has no mention of the words "life estate"?

 

[anteater]

Rather than get into a back and forth about the definition of a life estate, let me put it this way... If I were the girlfriend, I would insist that the deed to the property include my exclusive right to use the property as long as the conditions mentioned in the will are met.

I repeat my earlier suggestion:

I would suggest that you retain a local probate attorney, even if it is only on an hourly fee basis, to help you over the rough spots.

EDITED TO ADD:
If you don't get the details of that provision nailed down nail now, you are potentially setting yourself up for much heartburn down the road.

 

[LdiJ]

Transferring ownership to "whom"? Sounds like a life estate in this case would transfer immediate ownership to GF?

The will says as long as GF "resides in state" vs. as long as GV lives. Is this also a form of a life estate?

A life estate was not the "intent" behind the GF clause, so not quite sure about this one. Is a "life estate" inferred in the wording above, or would it have to be explicitly spelled out, as in mentioning the term "life estate"? The will has no mention of the words "life estate"?

No, a life estate does not transfer ownership to the GF. Google "life estate" and do some reading up on it.

 

[Zigner]

A life estate was not the "intent" behind the GF clause, so not quite sure about this one.

Actually, what you have written is almost the text-book definition of a "life-estate"

 

[jook]

Google "life estate" and do some reading up on it.

Yea, I did that, lots of it. This seemed to be a good overall summary :

A typical Life Estate deed legally transfers the future ownership in real estate, and reserves rights of current ownership in the person making the conveyance. This is different than an outright transfer where no strings attach to the person making the conveyance. A “life estate” is similar to the concept to a timeshare. With a timeshare, a person owns the right to use property during a designated period of ownership. An owner of a life estate has the right to live in the property for a lifetime. The lifetime right automatically terminates upon death when persons designated in the deed become outright owners.

Here the key points that doesn't fit ( to me anyway ):

1)Current owner is the deceased, so it has to be transferred to someone. If this is a GF life estate and "future ownership is transferred" via a life estate, then I would assume the GF must own it "now/after probate" and it only transfer to me later at the end of the life estate?

--All the "typical" cases I find show make sense where a life estate passes to a decendant at death from the current owner. So to fit this typical model, the GF would have to be the owner? That wasn't the intent, but sounds like that's where you guys are pointing to...

2)The right to live in the property (in this case) is NOT a lifetime, but only while GF resides in the state. It (the GF clause) should terminate if she moves out of state, so it doesn't have to be death to transfer in this case

--For a "typical" life estate, I would assume the life estate terminates with a death certificate. Pretty simple.
--No idea how this one terminates. There is no, "She's moved out of state" certificate.

I do think I'm way over my head on this one, and will seek some help to sort this out. Just trying to get at least a feel for what this means as a starting point and wondering what the deed will look like on this one.

 

[LdiJ]

Yea, I did that, lots of it. This seemed to be a good overall summary :

A typical Life Estate deed legally transfers the future ownership in real estate, and reserves rights of current ownership in the person making the conveyance. This is different than an outright transfer where no strings attach to the person making the conveyance. A “life estate” is similar to the concept to a timeshare. With a timeshare, a person owns the right to use property during a designated period of ownership. An owner of a life estate has the right to live in the property for a lifetime. The lifetime right automatically terminates upon death when persons designated in the deed become outright owners.

Here the key points that doesn't fit ( to me anyway ):

1)Current owner is the deceased, so it has to be transferred to someone. If this is a GF life estate and "future ownership is transferred" via a life estate, then I would assume the GF must own it "now/after probate" and it only transfer to me later at the end of the life estate?

--All the "typical" cases I find show make sense where a life estate passes to a decendant at death from the current owner. So to fit this typical model, the GF would have to be the owner? That wasn't the intent, but sounds like that's where you guys are pointing to...

2)The right to live in the property (in this case) is NOT a lifetime, but only while GF resides in the state. It (the GF clause) should terminate if she moves out of state, so it doesn't have to be death to transfer in this case

--For a "typical" life estate, I would assume the life estate terminates with a death certificate. Pretty simple.
--No idea how this one terminates. There is no, "She's moved out of state" certificate.

I do think I'm way over my head on this one, and will seek some help to sort this out. Just trying to get at least a feel for what this means as a starting point and wondering what the deed will look like on this one.

You are misinterpreting what you are reading. The property transfers to you, and she retains a conditional life estate. In this case YOU are the "current owner", not your father.

 

[jook]

You are misinterpreting what you are reading. The property transfers to you, and she retains a conditional life estate. In this case YOU are the "current owner", not your father.

Ok, that's good. Let's close this out...

Here's what google says about a life estate. I'm probably butchering terms here so bear with me, and I'll try to explain, in google terms. Hopefully this will end my confusion..

I'll assume :

• "current owner" = Grantor
• "future owner" = Grantee

Typical Life Estate :
Grantor has rights to property, pretty much owns it, with some possible conditions set forth in the life estate papers ( assuming the deed ). Upon death it's transfered w/o probate to Grantee. Life estate is done, normal deed issued upon a death certificate to Grantee.

This scenario :
I am current owner per the above interpretation, making me the Grantor.
But the GF will use the property, has rights to it now, which seems like she would be the Grantor of the Life Estate.

So it's not clear how I'm the owner/Grantor in this case. Sounds like this is a "flipped version" of the life estate if I am the current owner.

BTW, do really appreciate the help here.

 

[anteater]

And, just to get into some heavy-duty, hairsplitting semantics, it is for life as long as she meets the specified conditions.

You know, jook, that sounds like a pretty poorly-written provision. I really can't fathom how "occupy" and "...as long as she resides in the state..." go together.

What if she decides to downsize, moves to an apartment a couple blocks away, and leases the property? Does that constitute abandonment of the life estate?

 

[anteater]

This scenario :
I am current owner per the above interpretation, making me the Grantor.
But the GF will use the property, has rights to it now, which seems like she would be the Grantor of the Life Estate.

So it's not clear how I'm the owner/Grantor in this case. Sounds like this is a "flipped version" of the life estate if I am the current owner.

No, you are not the current owner. Your father is the current owner, or, if you will, your father's estate is the owner. As the executor/personal rep of the estate, you have the legal authority to undertake transactions on behalf of the probate estate. When all the bills are paid, the tax returns filed, etc. and it is time to settle the probate estate, you, acting as the executor/personal rep of the estate, grant ownership of the property to you as an individual, subject to the conditions outlined in the will.


(No quibbling about use of the term "ownership", please. It's easier than speaking in terms of "remainder interests", etc., etc.)

 

[LdiJ]

No, you are not the current owner. Your father is the current owner, or, if you will, your father's estate is the owner. As the executor/personal rep of the estate, you have the legal authority to undertake transactions on behalf of the probate estate. When all the bills are paid, the tax returns filed, etc. and it is time to settle the probate estate, you, acting as the executor/personal rep of the estate, grant ownership of the property to you as an individual, subject to the conditions outlined in the will.


(No quibbling about use of the term "ownership", please. It's easier than speaking in terms of "remainder interests", etc., etc.)

You are just going to confuse him more with this...he doesn't understand that ultimately he is going to own the home, and that his father's girlfriend is just going to get to live there.

He believes somehow, because he is misinterpreting what he is reading, that the "life estate" grants the girlfriend some form of ownership.

OP...

Your father is the grantor and his estate is the current owner.

You are inheriting the house and you will become the owner after probate.

The girlfriend merely has a conditional life estate. She will NEVER be the owner.

I keep trying to explain this in terms that I think that you will understand, but I think that I am making it worse. Go get a consult with a local attorney.