"LKYPon" <lkypon[at]aol.com> wrote in message
news:20041005204300.11769.00001866[at]mb-m29.aol.com...
- quote -

I must admit that I agree with many of the responses posted. You are better
off staying out of this is if you can. If you can't I'd suggest you start
with a written letter to the Sister about the obvious pitfalls she is
setting herself up for, otherwise you may find yourself caught between a
rock and a malpractice attorney because you assumed some level of liability
by offering advice in an area you are not qualified in. And recommend - IN
WRITING - that Sis talk to an attorney before you she do anything.

There are some other issues here that I fear could come up and bite someone
on the backside.

You said Son owns the house but Sister is taking title. If no money is
changing hands between Brother and Sister there may be a gift tax issue
involved.

Who will be making the new mortgage payments? I know who will be
responsible (Sis) but if Brother can't work enough to pay his own expenses
how will he pay his expenses AND make the mortgage payment?

This is a recipe for disaster as it looks right now. Sister is setting
herself up for big problems. She is going to be stuck with a house payment
that she can't make, her brother for a tenant who can't pay his own bills, a
possible gift tax issue, and a brother whose situation is not improving.
Besides, if brother has to go into a facility someone will expect him to pay
and if they find out that he transferred a house for no consideration to a
family member don't be surprised if they go after the house and assert that
the transfer was a sham.

The only real way out of this I see is if Sister is RICH - literally rolling
in the dough. If that is the case, by all means let her support her brother
if that is what she wants to do - but I wouldn't let it pass without a
writing from you advising her of the seriousness of her situation. And
since you posted in this forum and said Sister is a client of yours I'm
assuming you are an RR or IAR of some kind. If so, you may want to check
with your compliance officer about this before you do much more.

Good luck,
Gene E. Utterback, EA

lkypon[at]aol.com (LKYPon) writes:

- quote -

If the son owns the house, the sister can't kick him
out either now or in two years.

If he's giving the house to her, she can, even if he
only gave it to her so that she could refinance it.
If she owns it and is responsible for the mortgage,
that's only reasonable.

- quote -

So he's screwed himself up pretty well. It seems
to me that he's going to lose the house either way -
rather than play the game of transferring it to the
sister and refinancing and then selling it in two
years, he might consider selling now an dmoving into
a place he can actually afford, perhaps a rental or
a house which is cheap enough that it could be
purchased outright with the proceeds of the sale of
this house. I don't see why the sister is getting
involved in anything but an advisory role and, frankly,
can only see disaster coming of her financial involvement.

- quote -

Sounds like he's got a real problem.

- quote -

Maybe he will end up that way regardless of what she
does. I'd hate to see her allow his problems start
sucking away at her future and financial life.

--
Plain Bread alone for e-mail, thanks. The rest gets trashed.
No HTML in E-Mail! -- http://www.expita.com/nomime.html
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LKYPon wrote:
- quote -

Larry,
Being homeless isn't generally regarded as one of the better cures for
mental illness. And that really sounds like a possibility here. I've
actually known a few people over the years that more or less match the
description you've given...when they didn't have the right medications.
When they did, they were brilliant, held down very good jobs, had normal
relationships, etc. Bad brain chemistry, that's all it is sometimes.

Rather than "curing him", sending him on the street could well doom him
to a cardboard box. You might instead raise the issue with the sister
and provide a list of local mental health resources. They might find out
he's just a lazy bum, but until that point suggesting that he "be
homeless to get his act together" is cruel. Pretend he's diabetic & it's
insulin - would being homeless cure diabetes?

-Tad

- quote -

Currently the son has title to the house.
The sister is taking title to the house and refinancing to pay off his debt and
get a better rate than 14%.
- quote -

The son got the house since he was living there and the daughter got the rental
property. They were pretty much equal in value.

- quote -

He is very smart, but can't hold a job. He claims he can only do one thing a
day. He says he has sleep apnea.
He's got some mental disorder, but refuses to get help. He's a major pack rat.
The house is full of junk, plus a storage locker full of stuff.

He refuses to dump or sell his stuff.

I told him to take his stuff to Auction Drop (you can drop stuff off at the
closes UPS Store) and let them sell the stuff on EBay. He's got some
interesting collectibles.


- quote -


Maybe the sister should let him be homeless since he blew his inheritance.

Larry

John,

I fully agree with your comments. The sister is my client and the dad was my
client before he passed away.

Unfortunately, we can't find an influential person to get the son in order.
He's a really bright guy that can't hold a job. He went to MIT and used to be
a computer programmer before he got off track.

I think he's going to have to be homeless to get his act together.

Larry

In article <20041005204300.11769.00001866[at]mb-m29.aol.com> , LKYPon
<lkypon[at]aol.com> wrote:

- quote -

What is your role in this, Larry? Unless you are a brother, my
advice would be to butt-out. First off, the son is nutty. He has
squandered his inheritance, and must have toasted his credit to have
a 14% loan. Next, the sister is nutty. She is enabling this
behavior by bailing out the nutty son. All this does is allow the
bad behavior to continue. There is no role in this for you, Larry,
so just keep your distance, and let the kids behave as they will.

What should have happened is a formal probate and closing of the
parents estate. As part of this estate process, the house should
have been sold and money distributed to the kids. If one of the
kids wanted to buy the house at that time, then a deal should
have been formalized in writing and recorded at the county
court house. Since they failed to do all of this, they now have
a big mess. You don't need this mess, Larry, and all you are
going to do is end up being the target of their anger when this
thing blows up. You cannot change history, and you certainly
cannot make these children grow up overnight.

They need a priest or a psychologist, not a financial wizard.

-john-

--
================================================== ==================
John A. Weeks III 952-432-2708 john[at]johnweeks.com
Newave Communications http://www.johnweeks.com
================================================== ==================

Who actually owns the house?

What were the arrangements the parents left in their estate planning?

Why can't he hold a job?

What would substitute housing cost?


"LKYPon" <lkypon[at]aol.com> wrote in message
news:20041005204300.11769.00001866[at]mb-m29.aol.com...
- quote -

Here's the fact pattern:

Son is 50 years old and has lived with his parents his whole life. Both
parents are deceased and he is still living in the house. He can't hold onto a
job. He is actually a very smart guy, just can't keep a job.

He has mortgaged this house to cover his expenses and currently paying 14%
interest on the mortgage.

His sister is bailing him out and refinancing the house at a reasonable rate.

She wants to sell the house in 2 years, hoping the brother will clean up the
house so it can be sold.

I don't expect him to change. Therefore, in 2 years I expect this house will
still be a mess.

What would you advise?

Sell the house now and let the brother go homeless? The sister seems obligated
to help this guy out, but he's not doing anything to improve himself.

Believe it or not, I've seen this fact pattern a few times already. It's been
really tough. I don't know what to do.

Cheers,

Larry