Debt repayment written agreement separate from a will/trust

[Grip1]

Jurisdiction

New Jersey

My brother and his wife are borrowing a large sum of money from my parents so they can have a child through a surrogate mother. An agreement in writing about repayment has been written, notarized, and signed. In the event of my parents' deaths, the repayment would be reflected in both my brother's and my inheritance. Sort of like my brother using his inheritance before inheriting it? It is not a part of my parents' will.

I don't know if this is more under the realm of contract or estate law, but I do have concerns about the legitimacy of the written agreement and if it could be challenged in any way like a will or trust. There is a big strain on the relationship between all three parties to begin with. Add this in and it could be a battle emotionally and in court.

Trying to be prepared ahead of time and know what to expect before the inevitable day comes.

 

[mightymoose]

Anything can be challenged. All anyone can do is speculate upon the reasonableness of that challenge.

My suggestion to all parties is to have a trusted attorney review your agreement and all parties be open to making necessary modifications. There is certain to be important factors that are overlooked. Taking the time and expense now to prevent problems later is in everyone's interest.

 

[Zigner]

I agree that an attorney would not be a bad idea.
Having said that, it seems to me that the loan would be a debt owed to the estate, just like any other debt owed to the estate.

 

[Zigner]

I can't "edit" my prior post...

There would be nothing wrong with the full amount of the remaining debt simply reducing the amount of money that your brother is due from the estate. If there are only the two beneficiaries (you and he), then his proceeds would be reduced by a max of half the outstanding amount of the debt. This is, of course, assuming that the estate has enough assets for everything and everybody.

 

[zddoodah]

This sentence

It is not a part of my parents' will.

seems to contradict this sentence

In the event of my parents' deaths, the repayment would be reflected in both my brother's and my inheritance.

If it's "not a part of [your] parents' wills" (plural), then how exactly will "the repayment . . . be reflected in" your and your brother's inheritances?

I do have concerns about the legitimacy of the written agreement and if it could be challenged in any way like a will or trust.

I don't really know what this means -- in particular, it's not clear what sort of comparison you're seemingly drawing between the loan agreement between your parents and your brother and his wife and a will or a trust. However, there is not anything that cannot be challenged.

And, ultimately, I'm not sure what any of this has to do with you. You're not the one making the loan and you're not the one receiving the loan, and what your parents do with their money isn't really any of your concern. The parties to the loan agreement apparently felt comfortable enough with it to sign it, so what's the issue beyond that?

 

[Zigner]

If it's "not a part of [your] parents' wills" (plural), then how exactly will "the repayment . . . be reflected in" your and your brother's inheritances?

The OP probably is contemplating an offset. Of course, the estate can't force the brother to accelerate the repayment...

 

[army judge]

No one should expect to receive a nickel via inheritance.

The expectation of any financial equality is foolish.

The donor upon her/his demise has no legal duty to leave a dollar to any of her/his issue.

 

[Zigner]

No one should expect to receive a nickel via inheritance.

The expectation of any financial equality is foolish.

The donor upon her/his demise has no legal duty to leave a dollar to any of her/his issue.

Very true - however, in many families (mine included) any debts owed by the children at the time of the parents' death reduces the amount they take from the estate by a proportionate amount. It's not an uncommon scenario in estate planning

 

[army judge]

Very true - however, in many families (mine included) any debts owed by the children at the time of the parents' death reduces the amount they take from the estate by a proportionate amount. It's not an uncommon scenario in estate planning

If both parents don't expire at the same time, the surviving parent very often creates a will very different from the person predeceasing her/him.

My mother was predeceased by my father.

I gave what dad bequeathed me back to mother.

I advised mom to not leave me anything, rather do whatever she wished to do with her property and holdings.

She disbursed it according to her wishes.

I had made my own way in the world and wasn't sitting on a power pole imitating a turkey vulture.

I stand by the following:


No one should expect to receive a nickel via inheritance.

The expectation of any financial equality is foolish.

The donor upon her/his demise has no legal duty to leave a dollar to any of her/his issue.

 

[Zigner]

If both parents don't expire at the same time, the surviving parent very often creates a will very different from the person predeceasing her/him.

My mother was predeceased by my father.

I gave what dad bequeathed me back to mother.

I advised mom to not leave me anything, rather do whatever she wished to do with her property and holdings.

She disbursed it according to her wishes.

I had made my own way in the world and wasn't sitting on a power pole imitating a turkey vulture.

I've told my father the same thing.

I stand by the following:


No one should expect to receive a nickel via inheritance.

The expectation of any financial equality is foolish.

The donor upon her/his demise has no legal duty to leave a dollar to any of her/his issue.

And I still agree with it

 

[Zigner]

Sorry for the messed up quoting - I still can't edit (or delete) posts.

 

[PayrollHRGuy]

I still can't edit (or delete) posts.

FYI I'm not having any problem editing.

ETA: The edit box may be considered a pop-up. Make sure you have cleared thelaw.com to allow pop-ups.

 

[Zigner]

FYI I'm not having any problem editing.

ETA: The edit box may be considered a pop-up. Make sure you have cleared thelaw.com to allow pop-ups.

I don't even have a button to click...it was working fine and then just disappeared a few days ago...around the same time that my private messaging functionally was instated.

 

[PayrollHRGuy]

I don't even have a button to click...it was working fine and then just disappeared a few days ago...around the same time that my private messaging functionally was instated.

Open a tech support ticket. If I couldn't edit I might not post.

 

[Zigner]

I never make mistakes, so would have no need for additing.







hahaahah.

 

[zddoodah]

I don't even have a button to click.

Ditto...for about a week.