FundRobot » Trust Funds » How do I get a lein released if lender dies before payoff?

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Old   #1 (permalink)
 
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Default get a lein released if lender dies before payoff

My Father in law loaned us the money to purchase our home.All he asked was that we get a promissory note secured by a deed of trust.
The loan will be considered settled,in the event that he dies before we repay.How can i make sure that all documents will be settled and the lein released if he is dead?Will he need to put it in his will?

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Old   #2 (permalink)
 
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Default get a lein released if lender dies before payoff

Hey Eric I have a solution!
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more..
Old   #3 (permalink)
 
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Default get a lein released if lender dies before payoff

It will be probated and a judge order it.
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Old   #4 (permalink)
 
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Default get a lein released if lender dies before payoff

Have him either write it into the terms of the Promissory note or have him write his will such that the debt is forgiven should he die before the debt is paid. This does not mean other heirs cannot challenge the will since this is a debt, so your best bet is to get a good estate or contract lawyer to draft up the language.
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Old   #5 (permalink)
 
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Default get a lein released if lender dies before payoff

I suspect that the promissory note itself includes a clause about the loan being settled in the event of his death. But yes, he should include it in his will just so there's no further question about it. Your husband's siblings might question it if they feel that forgiving of the loan at the time of his death unfairly distributes your father's estate among the heirs.
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Old   #6 (permalink)
 
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Default get a lein released if lender dies before payoff

Your father-in-law would need to place these conditions in writing.

It would be to your benefit to have professionals handle this situation.

It might be to your benefit you to contact a local title company to do the paper work on your behalf. they would prepare the proper deed of trust as well as the proper lien in your father-in-laws benefit. If course they would take into consideration any payments already made. The title company would charge a minimal fee for their services. They would also record all deeds and other paper work with the county recorders office. Using a title company could prevent potential future legal problems.

Your father-in-law might consider a revocable trust indicating the properties disposition upon his death and that the property is to be yours upon his death. A trust is not contested in a court and the property would not be required to go through probate.

A good estate planner or attorney that specialize in estate planning would be able to prepare and fund a trust on you father-in-laws behalf. The company you hire to prepare this trust would charge you a fee for their services. You might contact several to find out the one that fit you economical.

You might consider using both these options as they would offer you and your husband the best possible protection for you to keep the property. Since this is a benefit to you, you and your husband might consider sharing the expenses.

Do not go to an attorney that would want to prepare a will that would list the house and indicate you would be getting the house, upon your father-in-laws death. A will can be challenged in court and would probably cause the property to be placed in probate. This is not in your best interest.

I hope this has been of some benefit to you, good luck.

"FIGHT ON"
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Old   #7 (permalink)
 
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Default get a lein released if lender dies before payoff

Discuss this with a lawyer.
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Old   #8 (permalink)
 
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Default get a lein released if lender dies before payoff

The language should be part of the loan agreement. You should have an attorney draw up the document so it meets local statutes. Good Luck
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Old   #9 (permalink)
 
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Default get a lein released if lender dies before payoff

Him saying in the will that the debt is considered paid on his death should suffice, AND it should state as such in the promissory note.
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