DEAR BOB: My will provides that my assets, consisting of my primary house, a Florida luxury condo, several rental properties, various bank and stock brokerage accounts, and two automobiles are left to my five living children (one died a few years ago). I recently consulted an attorney about this arrangement. She said it was a very bad idea to have a will leaving my assets equally to five children. Her advice is they will fight over the assets and the probate costs will consume a substantial portion. Instead, she recommends a living trust to avoid probate costs in the three states where I own property and to specify that after I die all my assets be sold with the net proceeds then divided among my living children. Does this make sense to you? – Rick R.
DEAR RICK: Yes. Your legal counselor gave you superb legal advice. With five heirs, there will almost certainly be conflicts. Also, probate court proceedings in three states will require hiring costly probate attorneys in those jurisdictions.
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All that can be avoided by transferring title to your real estate and other major assets into your living trust. You can amend it from time to time as the situation changes.
After you pass on, the living trust becomes irrevocable. Then the successor trustee, perhaps your attorney or the most trusted offspring, can distribute the assets according to the terms of the living trust without probate costs and delays.
WHAT IF CONDO HOMEOWNER’S ASSOCIATION IS INEFFECTIVE?
DEAR BOB: About three years ago, I bought a condo in a complex where I later discovered the homeowner’s association is very ineffective. Many of the monthly directors meetings are cancelled for lack of a quorum. When the directors hold a valid monthly meeting, they often disagree and refuse to take any action. The result is the property maintenance has become very poor. I would like to sell my condo, but I fear I might take a loss. I tried becoming involved in the buildings and grounds committee, but I discovered they never meet and nobody cares about the upkeep. What should I do? – Lucy R.
DEAR LUCY: Sell. Get out. If you tried to become active and to correct the bad condo management situation, maybe you should sell your condo and move on.
DON’T REMODEL HOME JUST BEFORE SALE
DEAR BOB: My wife and I have enjoyed our home for the last 32 years. It is in a great location and is in basically good condition. However, it is one of the few homes in the neighborhood that has not been upgraded. For example, most of our neighbors have installed double-pane windows. They have renovated their kitchens and bathrooms. Now we have decided to sell and move to a beautiful retirement home. Our question is should we remodel our kitchen, install new windows, and fix our home up to get the best price? – Henry G.
DEAR HENRY: No. My only suggestion is, if necessary, paint the exterior and interior of your home. Your listing agent can best advise if this will be a profitable expenditure. Paint is often the most profitable improvement you can make.
However, remodeling your kitchen and bathrooms will rarely return in added sales price as much as your cost. Also, consider the great inconvenience of the renovation. Just get your home into its best presentable condition and let the buyer renovate it.
The new Robert Bruss special report, “How to Become a Successful Real Estate Negotiator,” is now available for $4 from Robert Bruss, 251 Park Road, Burlingame, CA 94010 or by credit card at 1-800-736-1736 or instant Internet download at www.bobbruss.com. Questions for this column are welcome at www.bobbruss.com.
(For more information on Bob Bruss publications, visit his
Real Estate Center).
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