There is an interesting issue that surfaces from time to time when I'm helping my clients with their estate plan. Sometimes, they have a child who needs to live in the family residence after their deaths. The child in question may already be living there or may need a place to stay at some point in the future. Whatever the case may be, the clients want to make sure that child has a place to live. These “children” are often adults who are down on their luck, jobless, or otherwise haven’t been able to move out of the house. In some cases, the child may have special needs or other challenges. In other cases, they are simply financially challenged in someway.
This can be quite tricky when there are other children/beneficiaries involved. For example, one of the other children may not be crazy about the idea of allowing a sibling to simply live there after the parents have died. They see that child as a “squatter” or a “freeloader” who isn’t paying their dues.
Another child may want to rent the house as a way to generate revenue for the beneficiaries. Another child may insist on selling the house and dividing the proceeds. Therefore, if you want one of your kids to live in your house after you pass away (or in other real estate you may own), you need to spell things out clearly. You need to set very strict parameters about how long they will be allowed to live there. Are there any other restrictions or parameters? For example, will the child living at the house be expected to pay the utilities? How long will he/she be able to stay there until they have to move? What if the other kids need to sell the house for financial or other reasons? Can the Trustee evict the child living there?
The more you address in your living trust, the better off your beneficiaries will probably be. Sometimes, when there aren’t enough instructions in the document, such can lead to infighting in the family. This is especially important when there are more than two siblings involved. Even when all the siblings get along well enough, their respective spouses may ruin the harmony.
Therefore, here is the lesson: If you want one or more of your children to be able to occupy your real estate after you have passed away, then you need to be very specific about your intentions and your expectations. The clearer you are, the better things will probably turn out for everyone involved.
If you need help or other guidance with your estate plan, call attorney Robert Mansour at (661) 414-7100 and arrange for a consultation.