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Mom.had surgery recently and won't be able to return home. I am her DPOA and main caregiver,.and she has asked me to get house ready for sale...there are walls that need attention, some gutters replaced, kitchen faucet leaks and some windows are totally stuck and on and on. One realtor said, spend about $10k fixing up, and not any more. Another said if we tried to sell "as-is" it would only attract low-ball offers. So, mom has said to go ahead and work within the approx 10k fix-up budget. The problem is she doesn't have that much in her checking account. Am legally OK with extracting the monies from her Trust investments (non-IRA)? A friend said I should set up a totally separate account, in the Trust name, because once the house sells, I have to have a place to deposit it. I cannot put proceeds from house into her checking account since we are Joint Owners (she want me to inherit anything left over in that very small acct). The house is titled in Trust and after she dies (and all the nursing home bills ) if anything is left over the 5 sibs get what is left. So I just want it all to proceed without the sibs feeling like I wasted money getting it sold.

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Realtor here. The advice you received to do some fix-up is correct. As-is will definitely scare off buyers. And most buyers don't have a lot of cash to fix up a broken down home.

It's hard to be specific without seeing mom's home. My general advice would be to fix cosmetics and clean it to within an inch of its life. Get rid of lots of clutter, including closets. If you have to rent a storage facility for furniture clutter, do so.

You are trying to stage the home.walk thru it as a buyer and begin making a list. Pay special attention to the kitchen. Kitchens sell homes. Replace the faucet, take clutter off the counters except for a toaster. Fix any plumbing leaks.

Replacing windows is a big ticket item. I'm figuring that won't make sense. Tell your a Realtor that you will be very open minded in fixing things after a buyer has had a home inspection. Ask your Realtor what she would suggest you do to give mom the most bang for her buck.

Price it reasonably and don't let it languish on the market. The longer your market time, generally, the lower the offer.
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I too am sorry that your mother is no longer with you, and am equally sorry for the inappropriate and selfish behavior of some of your siblings.

Your mother's will and/or Trust if she has one may have a provision that the expenses of her last illness are priority payments. That should keep the family quiet for awhile as you calculate and make arrangements to pay all those expenses, including reimbursement for the funeral costs which you advanced.

I might even go so far as to change the locks on the house.
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Mallory, is your mother aware of the speculation that she won't be able to return home? I'm wondering if that's why she's not enthused about participating in her recovery.

You know her better than them - do you think she can turn this situation around? What did the operating surgeon say? I always hate to read about a situation in which people in a nursing facility offer a dire prognosis because we've been through that before with my father, at a hospital rather than facility, and he proved them all wrong.

Nonetheless, you raise the trust issue. These are just my opinions, based on experience working for EP law firms and handling my sister's trust. I am not an attorney, and would recommend that you run this scenario by the attorney who prepared the trust documents, just to make sure you have all the bases covered.

Just my thoughts...

The DPOA, assuming it contains the requisite provisions to allow you to withdraw from financial accounst, would authorize you to take funds from her investments. I would first start with the mandatory Minimum Distribution Requirements from her IRAs, as a specific amount must be withdrawn annually anyway. So use it for the house.

If you withdraw from mutuals, I assume you know that you may pay capital gains taxes on the difference between basis and fair market value on the date of the sale, so you might want to estimate that in terms of how much to withdraw as well as any taxes that may be owed on your mother's 2015 income.

The issue of a separate account is one on which I've been advised differently. It's my experience that bankers don't always understand that even if assets such as mutual and stocks are titled in the name of the trust, the income still is treated the same way for tax purposes while the settlor is alive. This is what our attorney told us.

I think to be on the safe side, and to keep the funds straight and separate, I would in fact create a separate account. However, I've only set up a trust account after death. I have no experience or reaction on how a bank would treat a trust account for a living trust when the settlor is still alive. (I'm assuming your mother has a living revocable trust.) There might not be any problems or issues. I did find that some banks had staff that weren't particularly knowledgable on living trust issues.

I agree that the funds shouldn't go into the joint checking account, especially since if anything does happen sooner, there would likely be an issue of withdrawing her funds and comingling them with yours. Since the joint checking account will cede to you after her death, keep it clean and don't comingle funds that would be allocated among the other siblings.

Thinking ahead, I'm wondering how you plan to hold the proceeds from the house after sale. Assuming there will be a substantial amount after payment of any existing mortgage(s), and assuming you're aware that savings accounts aren't paying high rates of interest, do you plan to invest the money and pay for the nursing costs as needed?

Again, I stress that this "advice" is based on my experience but probably isn't as thorough as would be a legal consultation.
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I know I plan to sell my parents house "as is" when the time comes... update remodeling can become a major headache and very time consuming. I would list the house "as is, price reflected of such" and hope for a bidding war by flippers :)

malloryg8r, since your Mother's house has a newer roof and newer A/C unit, that is great as those are major expenses for flippers so they won't need to worry about that. If you are curious what could stop a sale contract in it's tracks, you could hire your own Home Inspector, prior to listing the house For Sale, to come out [around $300-$400 depending on your area] and he/she will go over the house with a fine tooth comb letting you know what a buyer might ask to be fixed. That way you won't get any surprises when the Buyer has their own Home Inspection.

As for radon, houses on either side could have radon but not the house in the middle, or vise versa. Radon slowly travels underground, what might have been there for years could be gone or increased. One never knows until there is a test. Unless the basement is finished with a bedroom or a family room, many Buyers don't bother with a radon test if the basement is unfinished. If the house is on a slab, then a Buyer is more opt to have said test. Fixing is around $1500-$2500 depending on area.

That is strange about restrictions on renting... or does it mean if your Mother lives there, she can't have unrelated people renting rooms in her home? Renting out the house could become a quagmire unless you know the ins and outs of renting.
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Re your other question, as her POA, you are your mom. Anything she can do you can do. If you can take mom WITH you to place the POA, that will make it easier. Keep crystal clear records. Your siblings will question what you've done. Don't get sloppy.
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Freq - I just got home inspection done, ran $ 275. Very detailed, 17 pages with photos to accompany each area. Got the referral from probate attorney.

Now my moms house has foundation & settlement issues, so no FHA or VA buyers. Only cash or conventional. Difficult sale if has to go on market.

Garden - trusts and banks, sigh.....the banks don't train front line staff on legal basics. Really they are cashiers. Anything that isn't simple in/out is a problem. I work on projects that get paid via SWIFT & had an assistant recently who needed to get paid as she invoiced independently, it took like 8 people at her bank to get the code as nobody knew whats what.

Mallory does your bank have a trust dept? There usually is an older indeoendent bank or two in larger cities that are banks with a trust dept. if most of what you are facing financially for the next few years is in trust accounts, you might want to consider moving all to a bank that understands trusts.

Also about property taxes, find out IF mom needs to be living there to get the homestead or primary residence tax break. Some areas won't allow if in a facility. Or require a statement of return filed before taxes reduced. Taxes on 350k could have a huge jump if she can't get primary residence adjustment.
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Igloo, at one time I remembered there was a $250k tax deductible when it came to a single owner seller of a house... wonder if that that is still around? I hope so. One could take the selling price, subtract the price paid for the house years ago, subtract the cost of fixing it up to sell [believe there is a time limit on the fixing], and subtract the mortgage. The IRS makes it so complex at times.
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GardenArtist, thanks for the BankRate website, lot of good info there.

I remember decades ago some retirees would buy an investment property to which later down the road they would move into... being the house currently rental, they could remodel and deduct the expenses on their taxes while there was a tenant in the property or between tenants. And when the time came to move into that home, it was already updated :)
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Mallory, I hope the stroke issues can be addressed quickly and safely.

I'm keeping you in my thoughts and hoping tomorrow brings relief, stability and rest for both of you.
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Mallory, I am sorry for your loss and that you are having to deal with so much family wanting so soon.
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