Question: Dad wants me to sell his house when he passes but my stepmom is on the deed. He is still alive and I have his Power of Attorney. He paid for the property and pays all of the current expenses on it.
Loraine’s Answer: I am sorry for your father’s illness. Unfortunately, you can’t do anything about this situation. Your stepmother is already on the house deed along with your father, and she owns half of it (unless the deed actually says that she owns some share other than half, in which case she owns whatever share the deed says she owns). That ownership split was decided when the deed was issued to both of them. Who paid for the property and who is paying for any loans on the property does not matter. You can’t take her share away from her, and neither can your father.
If they own the house as joint tenants with rights of survivorship (which is controlled by how the deed is written) and if your stepmother survives your father, she will become the sole owner of the property automatically – no matter what his Will says about the house or what his current wishes may be. The only way his Will or other legal documents can control what happens to his interest in the house is if he and your stepmother own the property as tenants in common at his death. And note: his Will or legal documents only apply to his half interest in the house; your stepmother retains control of her half interest.
If your stepmother is willing to sign her interest in the property over to your father, then he can ask her to sign a deed that transfers her interest in the property to him. However, if she isn’t willing to do that, he’s likely stuck. If she is not willing to give him her interest in the property, then his best option if he still wants to try to control at least his existing interest in the property after his death will be for your Dad to try to break any joint tenancy, if they currently own the property as joint tenants with rights of survivorship. He may also then want to try to use a revocable trust in addition to a Will, and to transfer his interest in the house, along with his other assets, to the revocable trust as soon as possible before he dies. This could help reduce your stepmother’s ability to take control of your father’s interest in the property after his death. Your father needs to consult an experienced estate planning attorney as soon as possible.
Even though your Dad is ill, he really needs to do as much of this as possible himself. If you use your Power of Attorney to change the ownership of the house, your stepmother could more easily challenge your actions. She could try to say that you acted in your own best interests rather than your Dad’s, or she could try to argue that you were not authorized to take the steps you took under the Power of Attorney (and, depending on how it is written, you may actually not be authorized to take such steps).
Key Estate Planning Takeaway: Asset titling decisions have real and significant consequences and need to be carefully considered, especially for people who have children from relationships other than their current marriages, and especially for real estate. It is much better to consider how title to assets will affect your rights and the rights of the people you may someday wish to benefit before you take steps such as adding new owners to your real estate and bank accounts than to try to fix unwanted titles later.
This “Q&A with Loraine” blog series features answers from Morgan + DiSalvo Partner Loraine DiSalvo to questions posted on www.avvo.com. A key takeaway from each exchange highlights an important facet of estate planning.
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