Desperate Trustee

[David2019]

Jurisdiction

California

My elderly aunt has dementia and is in a board and care facility. I have been designated financial power of attorney and trustee of her revocable trust. The aunt also fully owns a home that is currently occupied by a relative who has been her caregiver for several years and who stands to inherit the home when my aunt dies. With board and care expenses exceeding my aunt's income I'm concerned about being able to continue paying for her care. Bank accounts will be drained within 6-9 months.

This situation is especially difficult since the relative living in the home appears to have very little interest in renting out the house to cover expenses and selling it would mean he'd lose a good portion of that inheritance. I've considered obtaining a home equity line of credit, but with expenses exceeding income, the banks aren't interested. I'm curious what options people might suggest. Here are a few I've considered:

1. Pay expenses out of my own pocket until a home equity line of credit can be obtained, then reimburse myself.
2. Co-sign for a home equity line of credit.
3. Stop payment on HOA and utilities thereby forcing the relative to at least pay the house expenses or face foreclosure.
4. Do nothing until bank accounts are drained and then move my aunt to a medi-cal facility. (Since medi-cal scoops up all my aunt's income, this still leaves the problem of paying house expenses.)

 

[adjusterjack]

I suggest you have the trust documents reviewed by an attorney to see if you have the option of selling the property without this relative getting it if that's what it takes to pay for your aunt's care.

 

[David2019]

I suggest you have the trust documents reviewed by an attorney to see if you have the option of selling the property without this relative getting it if that's what it takes to pay for your aunt's care.

I believe I do have the option of selling, but then I have to deal with trying to remove the relative from the house first.

 

[adjusterjack]

If the trust gives you the option of selling in order to meet the expenses of providing care, there is not "trying to remove," you give the relative 60 days written notice of termination per CA Civil Code 1946.1:

http://leginfo.legislature.ca.gov/faces/codes_displaySection.xhtml?lawCode=CIV&sectionNum=1946.1.

If the relative is not gone by the deadline, you evict through the courts.

You're the trustee. You're the boss. Don't let the relative walk all over you.

And don't wait until the money runs out. Do it while you have time to get the best offer for the property.

And do consult an attorney to solidify your position.

 

[David2019]

If the trust gives you the option of selling in order to meet the expenses of providing care, there is not "trying to remove," you give the relative 60 days written notice of termination per CA Civil Code 1946.1:

http://leginfo.legislature.ca.gov/faces/codes_displaySection.xhtml?lawCode=CIV&sectionNum=1946.1.

If the relative is not gone by the deadline, you evict through the courts.

You're the trustee. You're the boss. Don't let the relative walk all over you.

And don't wait until the money runs out. Do it while you have time to get the best offer for the property.

And do consult an attorney to solidify your position.

Eviction proceedings can be frustrating and time consuming especially when the relative knows he will be losing a big portion of inheritance if a sale is allowed to go through. With him being local to the house and me being hours away, it would be easy for him to sabotage any attempt to sell. Isn't a loan an easier option if I can arrange that?

 

[Richard Marvel]

My elderly aunt has dementia and is in a board and care facility. I have been designated financial power of attorney and trustee of her revocable trust. The aunt also fully owns a home that is currently occupied by a relative who has been her caregiver for several years and who stands to inherit the home when my aunt dies. With board and care expenses exceeding my aunt's income I'm concerned about being able to continue paying for her care. Bank accounts will be drained within 6-9 months.

This situation is especially difficult since the relative living in the home appears to have very little interest in renting out the house to cover expenses and selling it would mean he'd lose a good portion of that inheritance. I've considered obtaining a home equity line of credit, but with expenses exceeding income, the banks aren't interested. I'm curious what options people might suggest. Here are a few I've considered:

1. Pay expenses out of my own pocket until a home equity line of credit can be obtained, then reimburse myself.
2. Co-sign for a home equity line of credit.
3. Stop payment on HOA and utilities thereby forcing the relative to at least pay the house expenses or face foreclosure.
4. Do nothing until bank accounts are drained and then move my aunt to a medi-cal facility. (Since medi-cal scoops up all my aunt's income, this still leaves the problem of paying house expenses.)

You are in a difficult situation. As the POA and Trustee you are obligated to act in the best interest of your aunt. The assets of your aunt should be used to pay for her care, if you believe that her present situation is in her best interest. I would encourage the trustee to work with the beneficiary to explain the problem and possible solutions. If they are not willing to work something out, then you may have to sell the home.

 

[David2019]

You are in a difficult situation. As the POA and Trustee you are obligated to act in the best interest of your aunt. The assets of your aunt should be used to pay for her care, if you believe that her present situation is in her best interest. In Illinois I would encourage the trustee to work with the beneficiary to explain the problem and possible solutions. If they are not willing to work something out, then you may have to sell the home.

Thanks for your response. Given the situation, I believe it is in the beneficiary's long-term best interest to move out and rent the house. However, it has been his home for several years and would be a hardship to move out. Selling the house would also not be in his interest because, with the house gone, he would then be entitled to only 1/3 of whatever assets remain. My thought is that having the ability to borrow on the house gives me leverage to convince him to go forward with the rental plan, and if that doesn't work, I still have a means to pay for my aunt's needs.

By they way, I'm still paying all house expenses out of my aunt's funds. This person is unemployed and feels entitled to stay there rent free because he's been my aunt's live-in caretaker and confidant for so many years and still visits her regularly. If I tried to sell the place, I'd probably have to evict, and things could get very ugly and time consuming.

 

[zddoodah]

I agree with all of the prior responses. Without being able to review the trust instrument, it is impossible to say much of anything, but failing to consult with a local attorney could get you sued. That you're not local to where the property is located isn't particularly relevant to anything.