Question Hello. Our mother died and left her house in a trust to be divided between her 4 children. The oldest daughter, who is the executor, would like to sell the house to one of her children. One advantage would be saving realtor fees. Can you advise as to the potential problems with a situation like this ie conflict of interest and any legal problems that could arise? Thanks for your time and help!
Answer Hi, I'm sorry to hear of your loss. The four beneficiaries (your sibings) WOULD ALL HAVE TO AGREE. You might consider jointly picking a realtor and making assure it appraises at a fair value so that she doesn't sell it to her child for less than it's worth. I think it's important that both THE ESCROW COMPANY AND THE TITLE COMPANY SEE A COPY OF THE TRUST DURING ESCROW so it's clear that the trustee (your oldest sibling) can in fact sell the house per the terms of the trust. Then she would distribute the proceeds to you and your siblings.
The trade off of the realtor fees would more than make up for the fact that everything goes smoothly and legitimately. Here is an link to an article that explains things nicely when the process goes smoothly. Good luck. Kris Paden, Esq.
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Thank you very much for all that helpful information; appreciate it!
I will be pleased to answer any of your estate planning questions on topics such as wills, trusts, nomination of child guardians, how to avoid probate, how to reduce or eliminate death taxes, durable powers of attorney, probate, conservatorships, special needs child planning, and elder law. Thanks.
Fifteen years as an attorney, and training in Estate Planning at the Law Office of Diedre Wachbrit, APC, Westlake Village, CA.
Organizations CA State Bar, Pepperdine Center for Estate and Gift Planning, Tarzana Chamber of Commerce, Tarzana Community & Cultural Center, Los Angeles Bar Association, San Fernando Valley Bar Association
Publications The Transnational Lawyer, University of the Pacific, McGeorge School of Law Legal Journal.
Education/Credentials Graduated in top 1/3 of class from U.C. Berkeley;
Graduated in top 10% of class from UOP, McGeorge School of Law.
Awards and Honors Undergraduate: Traynor Honor Society
Law School: Phi Delta Phi Legal Society