Episode Transcript
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Speaker 1 (00:05):
Welcome to Life Happens Radio, featuring the attorneys from Pureau,
Counter and Strauss. Tune in every Saturday morning at nine
am for the most in depth discussions that help you
navigate the legal, financial, and health related challenges we all face.
Life Happens. Are you preparing?
Speaker 2 (00:35):
Good morning, Welcome to Life Happens. Are you prepared? This
is our weekly radio program where we address the challenges
we all face as we age. We talk about aging
as a lifestyle, the issues that must be confronted, and
the careful planning that's required to avoid crises in the future.
Life Happens will provide you with tools to educate and
prepare yourself for events like retirement, protecting your income and assets,
planning to pay for nursing home and home care, special needs,
(00:57):
wills and trusts, and planning for an on timely death,
as well as resolving disputes in and out of court.
I'm Aaron Connor from Pure O'Connor and Strauss. Good morning.
As I said, everyone, joined by a radio neophyte today,
Adriana Mahollick. Good morning, Adriana.
Speaker 3 (01:15):
Good morning, Aaron.
Speaker 2 (01:16):
So. Adriana is a relatively new associate in our office.
Speaker 3 (01:21):
How long has it been three months?
Speaker 2 (01:23):
Three months feels like longer? No, just kidding, no, it has,
But so want to just give some the listeners a
little of your law school or law career background.
Speaker 4 (01:35):
Sure, so, I graduated law school in twenty twenty one.
I during my third actually my two L and my
three L years of law school, I interned at a
firm in Troy general practice.
Speaker 3 (01:50):
But there I got some experience.
Speaker 4 (01:51):
When it came to some estate planning, corporate work, real estate,
and some other littlegation matters. I worked there upon graduation.
Speaker 3 (02:01):
And then things took a turn for.
Speaker 4 (02:03):
Me, meaning I kind of wanted to focus more in
one area, sure, to just really grow in my profession.
I felt that I wanted some mentorship guidance to grow
in a certain area. So I switched over to real
estate law. I did really enjoy real estate. I worked
at a high volume firm here in the Capital District
for about three years, and then, as luck would have it,
(02:25):
I again wanted to more focus on a different area
and learn more. For me, it was all about professional growth.
I think you need to expand the areas you practice in.
Speaker 2 (02:36):
Sure, so most people would consider real estate transactional, right,
So someone comes to you, they're purchasing their selling. Usually
those are really I mean, they can be doing other
things maybe, but predominantly.
Speaker 3 (02:52):
That's what you see predominantly.
Speaker 2 (02:54):
Especially from a consumer perspective. Yes, and you know, maybe
later they'll ask, you know, can you do this will
or power of attorney, But general experience with people who
don't do documents like that on a regular basis, it's
not good. I'm sure we say this quite often on
(03:14):
the show. I certainly don't want to do a closing.
I can tell you that. So if we we have
to for some reason do a closing in the office,
that we'll be going to Adriana Thosk, I'd.
Speaker 3 (03:24):
Be very happy to.
Speaker 4 (03:25):
You know, you could tell right away when someone was
not a real estate attorney. It's it's very obvious and
sometimes difficult to work with, but like you said, transactional.
But at the end of the day, everyone has the
same goal right to get to the closing, so regardless
you make it work.
Speaker 2 (03:39):
Too much math. I didn't really enjoy the math part.
I was always a good math student, but I really
never enjoyed it. I certainly didn't enjoy it. When we
were talking about co tangents and as totes, and you know,
you know, I didn't know that algorithms were going to
rule the world back then either, but it just never
(04:01):
really did anything for me.
Speaker 3 (04:03):
So the calculator became my best friend.
Speaker 2 (04:08):
So, but real estate math or real estate law does
involve a fair amount of math. So I think probably
you're doing less math now, but you are handling a
state administration cases and trust administration cases, and so there
is some math, definitely, because we have to figure out
who's getting what. There's also math done when people take commissions,
(04:31):
which they are allowed to do either or both in
the document and under New York state law. Actually, New
York State law is pretty generous when it comes to
in a state commission five thousand of the first hundred thousand,
four thousand of the next two hundred thousand, and so on.
It's a word problem again. Math, Yes, so there is that,
(04:57):
But I mean you had some exposure to this, you know,
some small exposure to this, and now it's your primary
practice area at least for now, correct. I know you
have some interest in doing some planning. I do some
other things. So we'll let you learn the end. I
guess first, right, So, that in our world, learning a
(05:20):
state administration is particularly instructive because you see how everything
works or you see what hasn't worked, definitely a lot
of cases. So we try to keep people out of probate, right,
and there's a lot of confusion about what that means. Right.
There are people who think that they have a will
so that nothing goes to probate. That is one wrong
(05:45):
So sorry if I hurt your feelings had that thought,
but that you could not be more wrong about that.
So when we're doing a trust administration, hopefully people have
given us the information that we needed to make sure
that everything was tied to the trust. They've gone through
the funding process, and essentially we might be creating downstream
(06:06):
trust which we call beneficiary control trusts, which we probably
should come up with a better name for at some point. Yes,
it's a bloodline trust essentially, and I know a lot
of people like that terminology better. And it's an asset
protect a trust, which is a big deal. So if
your son or daughter marries someone who is less than
(06:31):
trustworthy or not good with money, or I don't know,
has terrible ideas, you can protect the money from that purpose.
So that is a big part of what we do
in the office is protect downstream money because if I've
learned anything, the hard part is accumulating the money. When
(06:53):
people inherit money, very few people treat it as if
it was money that they earned themselves. They don't. They're
much more willing to spend inherited money in a lot
of cases quickly. So that can also be restricted if
you so choose. It's important to know. But if you
(07:14):
don't do anything, you have none of these options, and
we end up in what's called an administration, which is
the absence of a will. And we've had to counsel
a lot of people when a spouse and children exist
that if there's no will, everything doesn't go to the
wife or husband, whoever it may be, which is surprising
(07:35):
to most people, but that's the way it is. And
it can be really messy if there are minor children,
because then we have to get guardians appointed, and you've
dealt with some aftermaths.
Speaker 4 (07:46):
Of that, and the result of that is, you know, honestly,
that ends up costing the estate more money anyways, and
you know that's not necessarily their wrongdoing. Maybe they just
hadn't gotten around to that. But in the end, it's
a hurdle that.
Speaker 3 (07:59):
They have to.
Speaker 2 (08:00):
Yeah. The only people who bank out in that situation
are lawyers. Yeah, and we know, we know how you
feel about lawyers, so we are we're trying to help you,
in the words of Jerry McGuire, help me help you.
Speaker 4 (08:11):
Well to that point, I think we do a very
good job of advising our clients of actually funding trusts,
because you know, since starting here, you know, three months
ago or so, I've been talking to some friends of
mine and everyone just thinks, oh, but I have a trust,
so my house is in the trust, Like, well, no,
you actually have to take the steps to title the
(08:32):
house into the name of the trust, or we're going
to be dealing with what Aaron is saying, going through
probate or if you don't have a will through probate,
but the administration side of it. So I think it's
very important to know that just because you have a trust,
you still have to take the steps to actually put.
Speaker 2 (08:49):
Things in it that's right, and you know, at a minimum,
and update beneficiary designations, right because not usually we are
not titling everything in the name of an irrevocable trust. Right,
So if we're protecting assets depending on where you are
in life, how old you are, how healthy you are,
what your goals are. You know, the older you are,
(09:11):
the more we're going to tie into your trust. But
we're always leaving a bank account outside and that you
need to make sure has a beneficiary on it. If
you have a retirement account, you need to make sure
you have multiple layers of beneficiary on it. Unfortunately, we've
had a few cases where retirement accounts have had to
(09:32):
go to probate because they were either they were left
to no one or more typically they were left to
a spouse and no cogingent beneficiaries. And it's just a
nightmare that can easily be avoided.
Speaker 3 (09:45):
Easily be avoided.
Speaker 4 (09:45):
I would say, you know, talking to anyone like I say,
now you know, friends, family, always at a beneficiary or
a joint owner if you know, that's something you feel
comfortable with. But in the end, it makes it easier
for your loved ones after your pass.
Speaker 2 (09:59):
Yeah, can be tricky because if you that gives people right,
that other person rights to the account at that very moment,
that's right and it has happened. So and even in
a great situation, if you're giving a son or daughter,
you know, a joint account. Then when a child, their child,
(10:21):
your grandchild goes to college, they would have to disclose
that as an asset of theirs as well. So that's
going to half count, and that's not really ideal generally speaking,
although I mean, I think the financially world is going
to look a little different coming in the future now
with all these limits on loans, et cetera. So but
just something to be aware of, because I do think
a lot of people get tripped up on that.
Speaker 3 (10:42):
Sure.
Speaker 2 (10:46):
So what we're going to talk about today are really
a lot of real estate issues that come up related
to planning, whether that be how people own a property
and how sometimes multiple people own a property can still
end up in probate for just to share, which is
a nightmare, or issues in the States with properties which
(11:10):
there are many and not sometimes easy solutions. We also
probably will, I think towards the end talk about vacation
properties and things we want to do with those and
how you can set that up not to be a problem,
because there are a lot of times those properties are
someone's life dream and they want to leave them to
(11:33):
their kids, but there are competing interests. Maybe geoggraphical differences
where one kid can't really use it very easily, or
one kid can't afford for all of it, right, So
those things need to be thought out and how you
do that. So we're going to be coming up on
(11:55):
our first break, but when we come back, we'll delve
into the different ways that people can own a property
deed wise at least first, and see the positives and negatives,
because it's not necessarily one is better than another for
any for all situations. It's not. But we need to
think about those things, and we need to understand what
(12:16):
might happen when we owned property with other people upon
one or another's death. So that's where we're going. This
is Life Happens Radio. I'm Aaron Connor from Pierre o
connor and Strauss and we will be back right after
this break. Welcome back to Life Happens Radio. Aaron Connor,
Pierre O'Connor and Strauss joined by our I think newest associate,
(12:40):
Adriana Mahalak. That will not be true soon, yeah, because
I keep calling them boys. I'm sure that they would
not love that. But young men. Have two young men
that'll be starting with us soon that were law clerks
with us. So they've decided that they like what we
do and want to do it, and so we will
(13:03):
be training them up and they will be the newest people.
Speaker 3 (13:07):
Thank goodness, it's about time.
Speaker 2 (13:10):
So always always daunting being a young attorney people. Really
it's it's pretty stressful profession, especially when you're right out
of school, because you really have no idea.
Speaker 3 (13:26):
I mean, well, and people call you.
Speaker 2 (13:27):
Out on it, right, I mean, you've learned a lot
of things, but you've learned a lot of things that
you're never going to use as well. I mean, depending
on what area of practice you go in, right, you
have to take criminal procedure, you have to take evidence. Well,
if you're doing a state planning, those things really don't
matter very much hopefully criminal procedure not at all. So
(13:48):
you know, contracts marginally valuable and what we do, but
mostly you know New York practice marginally valuable. So they
will have some knowledge, but it will be incumbent on
us and them to help them alone. They will have
a lot of resources, which is good. That's not something
that I had where I started. The firm I started
(14:10):
at was more like, here are your twelve files for
today and you know figured out. Oh, by the way,
there's a court appearance. I wanted them tomorrow. I'm sure
it'll be fine. Thanks, Thanks for so we don't do
it like that, think or swim. Yeah, that was pretty old.
That was the old school way though there really wasn't
like a lot of mentorship necessarily not definitely not the
(14:34):
better way to do things.
Speaker 4 (14:35):
I think something too is just learning how to be
an attorney. I think a lot of that is client communication,
sure as well. So I think i've you know, had
some background or some time to learn that. Yes, and
I'd like to think, you know, clients maybe might not
be going through whether it's this area or another area
of law, every day. They don't know necessarily the ins
and outs of what we're talking.
Speaker 2 (14:55):
About, and they might not be having their best day
because in a lot of our situations, either someone needs
long term care, they're not doing well physically, or they've
passed away, or in my case, we're maybe doing a
guardianship because they lost capacity and people are trying to
take advantage of them. So it's it's not necessarily that
we see people on their best day. We see a
(15:15):
lot of people doing proactive planning and that's easier and
better frankly, much more pleasant conversation, although we still have
to say what happens when you die? Oh, and what
happens if your kids die?
Speaker 4 (15:25):
You know.
Speaker 2 (15:25):
I mean, so that part never really is great. But
you have to know who you're talking to. Communication obviously
very important, and what kind of mood they might be in,
you know, and how you carry yourself in both how
you deliver news, whether it's good news or bad news,
(15:47):
and how you carry yourself in you know what you're
doing right, and we don't put young people in a
position where to pretend they know what they're doing right.
Someone else will be there to help them through that.
But it's important that the attorney convey that their knowledge
and experience in the situation because it's comforting.
Speaker 4 (16:09):
To people in our area too that you do actually care,
like you want to get help them get through this
difficult time.
Speaker 2 (16:15):
Yes, well, a lot of people can't grieve until after
this is state administration. I mean, they're grieving along the way,
but there's no closure or finality why this is open
and the longer it takes, the longer they're going through
that process. Right, So I mean, we do play therapists
a little bit here and there. It's probably not my
best skill, but we do do it. So. I had
(16:41):
mentioned though that there are different types of deeds because
we're going to talk about real estate, right and at
least coming to mind to me, there's predominantly two types
of holdings that we see, joint tenants or tenants in
common right. Correct, there's a special quote unquote tendency by entirety, right,
which means you're married, but it's really for all intents
(17:03):
and purposes of joint tenancy right, right, So can you
give the listeners some ideas some differences between joint tenants
and tenants in common?
Speaker 4 (17:13):
Sure, I'd be happy to so the joint tenants with
right of survivorship. As Aaron said, it's similar to the
when you're taking title when you're married. That means that
when one of the title holders passes away, the survivor
becomes the automatic owner of the house one hundred percent.
(17:33):
You don't have to go through probate in that instance,
you don't have to sign another deed, which I think
a lot of people think it's an automatic transfer of ownership.
Speaker 2 (17:41):
Yes, we say by operation of law.
Speaker 4 (17:43):
By operation of law and then tenants in common differs
on the fact that when let's say the first one
passes away, they're shared is not automatically, by operation of law,
transferred to the survivor. Instead, their share follows the estate
plan or goes to their next of kin if they
don't have an estate plan.
Speaker 2 (18:03):
Right, So that may and often cases goes to probate. Yes. Right,
So we see this a lot in Sometimes people own
property and get married later. Well, it doesn't automatically convert
to a tendency by the entirety if you owned it
as tenants in common, so that can be a big
trip up to people. It's more often than not we
(18:25):
see siblings inherit property and decide to keep it, and
if you're five of you, you're going to own it
as tenants in common usually right, And this is a
conversation I'm often having in planning consults. How do you
own that property? And then people look at me like,
what do you mean now I have a deed? Right? Well,
that's not the end of the answer, it's the beginning
of an answer. But more often than not, if five
(18:50):
people own it, it's tenants in common, and then when
somebody dies it goes.
Speaker 3 (18:56):
To their estate right.
Speaker 4 (18:58):
I used to say a closing because typically you know,
at the closing table where the seller signed the deed,
we're saying, how do you want to take title? And
I would explain the two you know, joint tenants with
right of survivorship, the other one to use the automatic
owner with tenants in common. Let's say they're not married,
they don't have children. Does a survivor really want to
own it with the deceased mother in law or their
(19:19):
mother in law?
Speaker 2 (19:20):
So I've seen all wild ones. That's very possible.
Speaker 4 (19:23):
And when I would say it like that, you know,
people took some time to consider it, and it was always,
for the most part, joint tenants with right of survivorship.
But it depends on each situation, like you were saying.
Speaker 2 (19:33):
Right, And I think a lot of times in this
inherited with inherited, that conversation doesn't happen. Right. A lawyer
just prepares a deed right, usually as tenants in common,
because that's the default, unless you really and once in
a while it is that these five people are joined tenants,
and then I have to explain, well, that's I call
that a winner take all scenario. Right, whoever survives gets
(19:58):
the whole property, and that it's usually not the intent.
It may occasionally be that. I mean, if all five
people didn't have children, or all five people you know,
only one of them had children that were interested. Maybe,
But generally speaking, you know, if five of you inherit
mom and dad's house, you're not going to lead that
(20:18):
entire interest to the survivor of.
Speaker 3 (20:20):
Everybody, depending on the situation.
Speaker 2 (20:23):
Right, and by the way, it's a good way to
end up with a lean on a property for several reasons. Yes,
someone doesn't pay property tax, right, and in that case,
everybody owns a fifth they all owe a fifth.
Speaker 4 (20:37):
Right.
Speaker 2 (20:39):
Somebody goes into a nursing home, they could lean their
portion of that property. One wrinkle, though, from a medicaid
eligibility standpoint, is that if you own property with people
who refuse to sell it, it's exempt. Okay, So this
is like a it's not one that you want to
play to rely on because it's not a good plan.
(21:03):
But if you and your brother own a property and
your brother's well and he says, now I'm not selling that,
then no one's going to buy your half interest. It's
not really marketable. So it's exempt. But if you and
your brother are similar ages and then he has a
problem and you have a problem, you have to sell
the property and you're in some financial difficulty. So it's
(21:29):
okay as a stop gap measure, but it's not something
you would proactively plan to use.
Speaker 3 (21:35):
Understood, So.
Speaker 2 (21:39):
Many many issues come up with these property ownerships. I
mean there's also deeds where people own the building attached
to the land but not the land right, and associations
we've had to transfer, mostly like Lake associations. Okay, that's
(22:00):
becomes a little you know, strange. I did encounter a
beach house in New Jersey once where I don't know
which church I don't know, but I want to say
it was a Protestant church owned all the land in
the town, literally all of it, yep. But there were
plenty of houses there and these people owned the house,
(22:21):
but they didn't own the land that the house was on. Yeah.
I would never really be comfortable with this scenario like
that in my own head. I mean, many years ago,
if local people might remember, there was a place along
the Mohawk and the Old Canal in a half Moon
and where Kraus's restaurant was, where there were a number
(22:42):
of houses there on the river, but those people did
not own the land. They only owned what they had
put on the land. And whoever owned Krauss or the
land at the time decided they were going to build
big apartments there and you needed to get off the land,
and it's not easy to move a house. I think
(23:04):
most of those people lost whatever they had built up
as far as structure. Yeah, but it is kind of
foreseeable at the same.
Speaker 3 (23:13):
Time too, right, right, I don't know who advised them.
Speaker 2 (23:15):
To exactly right. Better advice would be like, And by
the way, no, those whatever they just wanted to build
never got approved. Oh wow, messy situation, definitely so. But
it's just kind of sometimes the most instructive things are
the bad decisions that other people have made. Right, hopefully
(23:37):
it's not your bad decisions. Better instructive they can be,
but those are things that you want to think about
before you look into things. That's why we have title reports.
That's why we figure out can this person actually convey
what they say they're conveying in a real estate transaction?
And maybe when we come back after the news, we'll
just talk briefly about that, because I think that's important too.
(23:59):
There has been and more recently quote deed fraud out
there too. That's something that probably should just touch on
because I know a number of older people have brought
that up. So we're going to be coming up on
the news after that. We will continue to talk about
real estate issues related to estates. This is Life Happens Radio.
(24:22):
I'm Aaron Connor with Pierre O'Connor and Strauss and we'll
be back right after this. Welcome back to Life Happens Radio.
Aaron Connor, piro'connor and Strauss joined by brand new associate
Adron Mahleik, and we are talking about real estate issues,
some problems, some solutions. Hopefully we can give you some
(24:46):
guidance so you don't make mistakes that we've seen people make,
and that can be titling things incorrectly. It can be
not thinking about who might be receiving a share right.
So if you have a will and you leave something
five ways and somebody is then disabled at that time,
(25:06):
we have a problem. We're going to have a lawyer
appointed for them, a guardian at item to make sure
that they're getting what they're supposed to be getting or
they're in a nursing home, same treatment, or they're a miner,
same treatment. So in some cases you're leaving something to
five kids, but one of those kids predeceases you, so
there are children step up to take that share. They're miners,
(25:30):
we have a problem. Those are all reasons to use
a trust because we don't encounter guardian end items with
a trust. So it's important really to think about what
you're doing, what might happen, and a little more money
upfront saves a lot more money on the back end.
I can say that confidently after about fifteen years of
(25:52):
doing this, So we encourage you to do some planning,
certainly if you want to hear about how to avoid
a nursing home and keep your assets. We do have
a seminar coming up on August sixth at the East
green Bush Library and also on August thirteenth at the
Guilderland Wise MCA. You can get more information about those
(26:12):
at our website that's puro law dot com, p I
E R R Law dot com, or you can always
call the office five eight four five nine twenty one
hundred or send an email to info at puro law
dot com. So that commercial part is over wunder back
to talking about real estate. So, just from its most
(26:37):
basic thing, you have to make sure that the person
you are purchasing from has title to the property. And
so what's generally done.
Speaker 4 (26:48):
To show that, Well, typically there's a title search done,
but even before that, what I saw a lot in
real estate, you know, whether it was the purchaser side
or the seller side was the purchaser would say, oh,
the seller's in a state, so all's fine, we'll get going.
(27:09):
And I said, well, we have to make sure we
get title insurance. Of course, Well why do I need that? Well,
just because someone passes away and they have a will
that named someone as their executor doesn't mean that that
person just automatically has the authority to act on behalf
of the estate or sell it. And I think that
is a big misconception that people do have. I said, no,
(27:30):
we need to make sure that they actually went through
the probate process, They've been given the letters testamentary or
administration having the actual ownership or the authority to actually
sell the property. And I know that's one thing that
the title companies usually will require. They want to see
copies of all of those documents and via that title search.
(27:50):
They'll look through the chain of title, make sure each
person's ownership interest from dating back forty years, they have
accurately conveyed their of the property, and that there were no.
Speaker 3 (28:01):
Outstanding leans or judgments hanging on there.
Speaker 4 (28:04):
Because if you buy a house, right, but the leaner
judgment that becomes yours.
Speaker 2 (28:08):
That's right. So there's two I think important things there,
and we'll talk about the second thing first, and that's
leans or judgments. Right. So a lot of times we
see people had a mortgage, they paid off the mortgage,
but the release doesn't get filed yep, right, which can
be a problem. Has to be tracked down a lot
of the time, and in the banking world, many of
these banks have been bought by other banks, so sometimes
(28:29):
it takes a long time to track that down. Sometimes
it's deemed an ancient mortgage, yes, which is not really
being over forty it's kind of offensive. Forty years old
is ancient, but uh, you know, that's how it goes.
So that's the terminology.
Speaker 3 (28:46):
Yes, you know.
Speaker 2 (28:48):
So it's important that none of those things are out there.
There are tax lians, there can be judgments. You know.
One thing we haven't really touched on is life state
deeds and I as a firm, I along with Lou
we decided that we basically never do life a state
(29:10):
deed because it doesn't really work very well. If you
don't get through or five year look back, you have
to have people sign back property to you, they may
not be around to do so. I had a case
where a woman put the remainder interest in her son.
Her son died and that remainder interest went to his
spouse and she wanted her remainder interest back and the
(29:37):
spouse said, no, I'm good, right, right, she has no
legal obligation to give it back. Wow, So it doesn't
work well that way. I've also seen where there's four
or five people with the remainder interests and one gets
a judgment it's a problem, and it just is not
it's a bad substitute. It's kind of it's just it's
(30:01):
just not something I'd ever really be comfortable putting my
name on, and unless there was really really strange circumstances.
So it's not a good idea. Generally speaking, we don't
do them. So you were talking to my Goatsia and
(30:21):
I'm getting old. We talked about that's right, leans, right, Oh,
and we're talking about ability to convey. Yes, oh, now
I know. So we have had deeds where people have
carved out pieces, right, So mommy, right, So mom and
(30:42):
dad have one hundred acres. Johnny and his wife want
to start have their own house, so they give Johnny
and his wife five acres, and then they give their
daughter and her husband five acres. Right. It gets pretty
complicated to figure out whose is what. And so this
has come up recently. A deed was done that was
(31:06):
supposed to convey everything I believe, correct, all right, title
and interest, yes, right, but it did not. So now
we're in a state situation and we have to figure
out one what wasn't conveyed. Is there a description for
(31:27):
that piece of property? Yes, separately, Yeah, because in some
cases you might have to have a survey done and
a map done and a new description created for that.
Speaker 4 (31:38):
I mean, I don't know how antiquated it is if
someone's going to require updated one from.
Speaker 2 (31:43):
The stone three feet off the road, you know, I
mean people though right from the tree with I don't know,
but that's really and then the safest thing to do
in those situations is just repeat that, because you can't
get anything wrong if you repeat it.
Speaker 4 (32:00):
Sometimes title requires an updated one, which no one's happy
to get a survey, but hey, you want to know
what your property lines are, where your boundary lines are,
and so that's in short as well.
Speaker 2 (32:09):
So and that can happen all the time. I can
tell this story that so the house that my grandparents
owned and that my dad grew up in was built
on a lot that was originally fountains for the house
next door. And that's that's a true story. Fountains fountains. Okay.
(32:29):
So the house next door was a manor house. This
is not in the South, it was. It was in
Saratoga County, Okay. But you would walk in and there
was a giant staircase and there was a statue of like,
I don't know, a god or goddess and the light
bulb was literally coming out of their hand. That was
like the light for the banister.
Speaker 3 (32:47):
Oh my goodness.
Speaker 2 (32:48):
So it was, you know, and there was a in
the back there was like a carriage house that I
was always told that during prohibition was like a you know, gamp,
like a casino. And yes, so that house had a
big stone fence, like you know, thick, big pieces of block.
(33:08):
And when they sold off the Fountain lot, I don't
know what else to call it. And the woman who
built the house, who owned it before my grandparents put
like a Cape cod style house on it, that fence
covered the front part of her long okay, right, So
the fence was no longer the property line for the
for them, right, sure. And so my grandparents bought that
(33:30):
house in nineteen thirty nine and people then in the
late probably early nineties came and said that that stone
fence was on their property. Oh my, And I'm really
wonder what that lawyer was telling those people, because that
fence was well over one hundred years old at that point.
Speaker 3 (33:51):
Yeah.
Speaker 2 (33:52):
So that's what's called adverse possession. And without getting overly complicated,
if you have something like that and it's over your
property line conspicuously for a period of time ten years, yes,
then you own that property, right And I don't know,
maybe they didn't care when they put the fence up,
(34:13):
who knows, right, Yeah, but by the time it was
over one hundred years ago, it didn't matter. First of all,
no one was moving the fence.
Speaker 3 (34:21):
No one could move it exactly, and.
Speaker 2 (34:24):
It had been way too long, So I just don't
even know. And it's not a good way to really
introduce yourself to your neighbor. And we're talking about an
encroachment of possibly like one foot by six feet maybe
you know what I.
Speaker 3 (34:37):
Mean, nothing else to do.
Speaker 2 (34:39):
Yeah, it's not like a big deal.
Speaker 3 (34:41):
No, So.
Speaker 2 (34:44):
You know, getting a survey not a bad idea. But
you may find some things that you're unable to fix,
let's say too And I mean, if you really want,
you could ad just.
Speaker 3 (34:54):
A boundary line to reflect that you could.
Speaker 2 (34:56):
But I mean I don't know that most people would
go to that trum so anyway, So there are all
sorts of wild things that can happen, you know. The
deeds that don't convey everything or that accept a piece
out always make things more complicated and probably do require
(35:18):
a title report and a lot of these instances to
be sure we know who owns what. And lots of
times people come in and they own these little landlocked
parcels next to their parcel. They're not combined. We talk
about combining them, and that's certainly something that we combine
(35:39):
things on deeds a lot because from a medicaid perspective,
your residence is exempt if a well spouse is living
in it. So Dad needs to go to a nursing home.
Mom's got two or three parcels, but they all touch
each other. Well, we'll put them all on one deed
because guess what now they're all exempt protected, right, gotcha.
(36:00):
But like those are tricks, I'm not sure. You know,
most of the time people have gone to trouble to
separate parcels. They can still do that. The deed just
reflects that there's three separate parcels and if they wanted
to sell one, they still could. But sometimes it's actually
beneficial to put them on one deed for that medicaid purpose.
(36:20):
So when we're planning, we are also trying to think
about what might happen in the future and what the
most likely scenario is. I mean, nobody really knows, right,
we're just going to do it based on age, health assets,
existence of long term care insurance and whatever else. So
those things are important. Those are discussions we should have
(36:42):
even you know, when we're doing deed work, Like Adrianna said,
are you going to hold this as tenants in common
or you know, join tenants? That that's important and a
lot of people just have no idea.
Speaker 4 (36:54):
I recently talked with a relative of mine and I
did get her consent to talk about this, but not
give too much confidential information. You know, from a prior marriage,
she had one child, Her husband from a prior marriage
had two kids together.
Speaker 3 (37:11):
They had one, so four kids all together. In her will.
Speaker 4 (37:14):
She asked me to take a look at it. She
decided to reference all the four kids as her children.
You know, that happens wonderful because you know, step kids
typically don't have any rights. Really is what we say
in the will, but really the only asset was the house,
and it said, you know, to to.
Speaker 3 (37:32):
The four children. Per sturpies with that language.
Speaker 4 (37:35):
We all like saying that if they predecease, her goes
to you know, their next of kin. And I was
thinking about it and one of the two step children
it's not married, no children, So I said, hmm, well,
let me think about this. If she were to predecease
for some reason, her share would go to her mother,
(37:58):
which is my relatives husband's ex wife.
Speaker 2 (38:02):
Oops.
Speaker 3 (38:03):
And I said, you know, you were doing the right
thing there, but let's think about that now. Is that
going to happen?
Speaker 4 (38:08):
Who knows, But it's those little things that you have
to like, will she have a share in your house?
Speaker 3 (38:13):
You want your husband's ex wife. No, that is not
what she wanted.
Speaker 4 (38:18):
She had no idea that was a you know, potential
event that that could arise. So granted she is having
that document edited, but I think that was interesting to think.
Speaker 2 (38:29):
About it and something she would have never considered. So
I think it's a good time to take the last break.
This is Life Happens Radio Aaron Connor, Apio, Connor and Strauss,
and we'll be back right after this. Welcome back to
Life Happens Radio. Aaron Connor, Apio, Connor and Strauss, joined
by associate Adriana Mahalek. We have been talking about real
(38:50):
estate issues with planning and estates, and I think probably
one of the biggest ones are vacation homes as we
kind of generically call them. Could be lake property, it
could be a cabin, it could be I don't know,
a ranch, right, don't running too many ranches, but no,
(39:11):
not for me. You could own an island. I don't know,
that's for me, right. So, you know a lot of
people work their life to make sure that they have
a beach house, you know, a lake house whatever, it
may be a cabin. And when I say cabin, we
had clients a number of years ago that were very
wealthy people, very and they had quote three cabins on
(39:36):
their property that were thirty two hundred square feet each.
So I was like, yeah, I don't know if i'd
call that a cabin, but you know what, they called
it a cabin. I just had to roll with it.
But those things can be complicated assets to leave behind
for many reasons. Right. Obviously, the more people who have
(39:58):
an interest in the property, the more complicated it can be.
So you have to think about a number of things
who might use this property, right, Because if you have
three kids and one of them lives in Utah, they
may use the property, but they may not either, and
(40:20):
two kids that are local, right, it may set up
a kind of an unfair dynamic.
Speaker 3 (40:25):
As far as goes.
Speaker 2 (40:28):
We also often have issues with funding. Sometimes property taxes
on an up keep on a place on a lake
can be pretty expensive. Especially let's just say like if
it's not a year round camp, right, you have to
open it up, you have to shut it down. All
of it has to be done correctly. You may be
(40:49):
employing somebody to do that. You know, there may be maintenance,
just in the form of I don't know, lawn cutting
if you have a lawn, right and eventually some things
are going to need be repaired replaced, and you have
to kind of think of all that. So in the
best case scenario, people leave aside a pot of money
for that for a period of time. Right, So I've
(41:09):
seen people leave one hundred thousand dollars or something to
fund a property for a period of time, whatever that
may be. Right, some places, the taxes are less than
New York almost everywhere. So for instance, right, I hope
to eventually own a piece of property in Delaware, the
(41:31):
property tax on a million dollar house in Delaware somewhere
between fifteen hundred and eighteen hundred dollars. Okay, significantly different
than you, very different. They do have a small flip
tax on the on the seller, usually.
Speaker 3 (41:48):
As more than the transfer tax.
Speaker 2 (41:51):
Yeah, okay, it's a two percent of the transaction, huh.
And I think it gets more often split between buyer
and seller. But that all depends on the market. Right.
If the market's down, the buyer is going.
Speaker 3 (42:05):
To have to eat that one time though.
Speaker 2 (42:07):
Yes, exactly right. And if you know it's there. And
I mean even so, if it's a million dollar property,
I think you're talking about fifty thousand dollars, which is
not nothing. I'm not saying that in any way, shape
or form. But if you're spending a million dollars, it's
probably not going to stop you from spending so and
if you're spending five hundred thousand, then it's it's half that, right,
(42:29):
and it's you know, it's just one of those things.
Like when my parents bought a house in the villages,
there was also a bond that they had to then
take on a portion of because that's how the villages
were built through bonds, and then the builder of the
villages passed the savings or the expense in this case
of the bond onto everybody who bought, which is you know, smart.
Speaker 3 (42:52):
Yeah.
Speaker 2 (42:52):
So, and most people have paid off their bond well
and ahead of their house if they didn't, if they
got a mortgage, right. So there's all sorts of little
things in different places that you need to think about too,
you know. And even here like in Sacondaga, a lot
of people buy places and they want to knock them down. Yeah,
(43:13):
and that is not necessarily as easy as you might think.
The stories I've heard is generally you have to keep
one wall something like that. I don't I'm not going
on record as saying that that's the rule, But there
are rules about what you can do and what you
can do, and you can't necessarily just put up a
giant house on the property that you you've knocked in.
Speaker 4 (43:33):
And I think too, you know a lot of them.
I don't know if people just presume that they automatically
have lake rights or anything like that, but you actually
or dock rights. Do you have deeded lake rights saying
you can cross over this person's property to get down
to the.
Speaker 2 (43:46):
Lake or and let's talk about that for a second. Okay,
how exciting is that? Like if you're the person on
the lake and these people get to traverse your property
right like you're having a party and they're just going to, hey,
you having a party?
Speaker 3 (43:58):
And who?
Speaker 2 (43:59):
Right?
Speaker 3 (43:59):
Always the question? I feel like I don't love that
dive deeper into Yes.
Speaker 2 (44:04):
You need to be cognizant of those things.
Speaker 3 (44:06):
Just can't take someone's word that oh yeah, sure, yeah
you can. You got access to that doc right there.
Speaker 2 (44:11):
Yeah, No, it's very important and you know, functionally when
people have access across your property to the water is
not great because there's usually that could be at any
time of day or night, and any time of year.
There's very little restriction, and that's usually done as an easement,
but I don't know, it could be done as probably
a license or other things too, So lots of things
(44:35):
to think about. Our best strategy for passing on a
vacation home, though, is to put it in an LLC
with an operating agreement. And maybe at the first generation
it isn't so bad, right, if it's just two kids,
(44:56):
they can probably figure it out. Maybe they can even
be there to yeah, there at the same time, right,
depending on how get along. Right it's fourth of July weekend,
because those things become important.
Speaker 3 (45:08):
Sure who gets it that holiday?
Speaker 2 (45:10):
Right? But next generation it can be a little trickier, right,
because there might be six hands in the till at
that point, and they might be in many many different
places and again many different affordability levels. So when we
do that, we create an operating agreement that one allows
for a structure of determining who has it when right,
(45:31):
there's usually some kind of rotating system about who has it.
Fourth of July, Labor Day, Memorial Day, that kind of thing.
There is verbiage about what happens when people don't pay
their share. Usually what happens is it diminishes their interests
by that amount. Right, So that can become kind of
(45:54):
a tricky thing because there can be room for dispute there, right,
I say you will five thousand. You say, well, I
think it's only three thousand. I mean in that area,
we're not talking about anything that's worth really disputing in
a legal sense. Right, There's definitely plenty of room for
hurt feelings no matter what. So there are a lot
(46:16):
of things that it's not just as simple of here.
Here's the lakehouse because and you know, some people want
to restrict whether it can be sold or not too yes, right, yeah,
they think of this as their legacy or their family
house in the family. Right, And you know that may
or may not be possible. And it also depends on
(46:37):
what other assets there are. So if you have this
million dollar lakehouse and your other assets total less than
a million dollars, then more likely than not, one kid
is not taking the lakehouse, yeah, right, unless they have
a pool of other money to pull from, and it
might have to get sold, so it's in And even
(47:00):
many people we see now bought a property, let's say
on Sacondaga, for a number that was very low compared
to today, and if you know their child had to
buy out of that property, they probably might not be
able to do that. You may see somebody who paid
fifty and it's worth three fifty, right.
Speaker 4 (47:22):
I mean, something I think to consider as well is
the fact that you know, in New York, when someone passes,
the ownership interest immediately vests in the airs. Granted, it's
subject to the administration of the estate, but so if
the executor, you know, you think you have the authority
to sell the house, do whatever. Well, when it comes
(47:42):
time when you're at the closing table, those heirs are
going to be required to sign off on those documents
saying that they agree for it to be sold as well.
Speaker 2 (47:50):
Right, and we only have a couple of minutes of left,
But I do think we should briefly touch on when
there is an heir living in the property. Please, in
all respects try to avoid that situation because generally speaking,
that person does not want to pay They honestly they
(48:11):
owe rent to the estate. Yep, okay, which almost never
gets paid.
Speaker 3 (48:17):
Someone needs to be paying taxes.
Speaker 2 (48:19):
And a lot of cases that person wants the house right,
But the only way to do that fairly is to
get a real appraisal and then subtract whatever their share
would be from that, and they have to pay the rest.
And you know, in some of these cases there's a
mortgage involved as well, and who's paying the mortgage nobody,
(48:41):
So then we have a foreclosure issue which can probably
be averted, but you know, probably we have a lot
of stress in these situations and diminishing equity.
Speaker 3 (48:51):
And then you know, are they just they're going to say,
well then.
Speaker 2 (48:53):
A victim right, which we know is almost impossible.
Speaker 3 (48:59):
I mean a lot of time and money.
Speaker 2 (49:00):
Yes, it's just not I don't know, it's not a
good time to be a property landlord unfortunately. So no
no political commentary there, just that if you are trying
to get somebody out for nonpayment, it's a very difficult
time to do that. Buckle up, yes, and get your
check book out from all the rent you're not getting paid.
(49:21):
So certainly some things to avoid. So just to recap,
do some planning, right, know what your deed says. If
you are a tenant in common and you want that
asset to go to your estate. Okay, you can be
a tenant in common and assign that asset, that portion
(49:41):
of your asset to a trust, which can help quite
a bit at least for your planning. Doesn't help the
other tenants in common, but they need to do their
own trust. So come on in, let's do five trusts.
If you are a tenant by tendancy by the entirety,
then you're probably going to be okay, assuming that's what
you want winner take all or a husband and wife.
(50:02):
If you have other property issues, then we need to
have you come in. We need to talk them out
to find what the best solution is, because there's no
one solution for everybody. If you have any questions, we're
happy to meet with you. Five one, eight four nine,
twenty one hundred pure O'Connor and Strauss. I'm areon Connor
and we'll be back next week. Have a great weekend, everybody.
Speaker 5 (50:24):
You've been listening to Life Happens Radio, brought to you
by the law firm of Piero Connor and Stress. For
more information or to contact and attorney at the firm,
visit Piro Law dot com or call five one eight
four nine twenty one hundred. Please join us again next
Saturday at nine am for Life Happens Radio on News
Radio E ten and one oh three point one WGY,
(50:46):
and you will be prepared
Welcome to Life Happens Radio, featuring the attorneys from Pureau,
Counter and Strauss. Tune in every Saturday morning at nine
am for the most in depth discussions that help you
navigate the legal, financial, and health related challenges we all face.
Life Happens. Are you preparing?
Speaker 2 (00:35):
Good morning, Welcome to Life Happens. Are you prepared? This
is our weekly radio program where we address the challenges
we all face as we age. We talk about aging
as a lifestyle, the issues that must be confronted, and
the careful planning that's required to avoid crises in the future.
Life Happens will provide you with tools to educate and
prepare yourself for events like retirement, protecting your income and assets,
planning to pay for nursing home and home care, special needs,
(00:57):
wills and trusts, and planning for an on timely death,
as well as resolving disputes in and out of court.
I'm Aaron Connor from Pure O'Connor and Strauss. Good morning.
As I said, everyone, joined by a radio neophyte today,
Adriana Mahollick. Good morning, Adriana.
Speaker 3 (01:15):
Good morning, Aaron.
Speaker 2 (01:16):
So. Adriana is a relatively new associate in our office.
Speaker 3 (01:21):
How long has it been three months?
Speaker 2 (01:23):
Three months feels like longer? No, just kidding, no, it has,
But so want to just give some the listeners a
little of your law school or law career background.
Speaker 4 (01:35):
Sure, so, I graduated law school in twenty twenty one.
I during my third actually my two L and my
three L years of law school, I interned at a
firm in Troy general practice.
Speaker 3 (01:50):
But there I got some experience.
Speaker 4 (01:51):
When it came to some estate planning, corporate work, real estate,
and some other littlegation matters. I worked there upon graduation.
Speaker 3 (02:01):
And then things took a turn for.
Speaker 4 (02:03):
Me, meaning I kind of wanted to focus more in
one area, sure, to just really grow in my profession.
I felt that I wanted some mentorship guidance to grow
in a certain area. So I switched over to real
estate law. I did really enjoy real estate. I worked
at a high volume firm here in the Capital District
for about three years, and then, as luck would have it,
(02:25):
I again wanted to more focus on a different area
and learn more. For me, it was all about professional growth.
I think you need to expand the areas you practice in.
Speaker 2 (02:36):
Sure, so most people would consider real estate transactional, right,
So someone comes to you, they're purchasing their selling. Usually
those are really I mean, they can be doing other
things maybe, but predominantly.
Speaker 3 (02:52):
That's what you see predominantly.
Speaker 2 (02:54):
Especially from a consumer perspective. Yes, and you know, maybe
later they'll ask, you know, can you do this will
or power of attorney, But general experience with people who
don't do documents like that on a regular basis, it's
not good. I'm sure we say this quite often on
(03:14):
the show. I certainly don't want to do a closing.
I can tell you that. So if we we have
to for some reason do a closing in the office,
that we'll be going to Adriana Thosk, I'd.
Speaker 3 (03:24):
Be very happy to.
Speaker 4 (03:25):
You know, you could tell right away when someone was
not a real estate attorney. It's it's very obvious and
sometimes difficult to work with, but like you said, transactional.
But at the end of the day, everyone has the
same goal right to get to the closing, so regardless
you make it work.
Speaker 2 (03:39):
Too much math. I didn't really enjoy the math part.
I was always a good math student, but I really
never enjoyed it. I certainly didn't enjoy it. When we
were talking about co tangents and as totes, and you know,
you know, I didn't know that algorithms were going to
rule the world back then either, but it just never
(04:01):
really did anything for me.
Speaker 3 (04:03):
So the calculator became my best friend.
Speaker 2 (04:08):
So, but real estate math or real estate law does
involve a fair amount of math. So I think probably
you're doing less math now, but you are handling a
state administration cases and trust administration cases, and so there
is some math, definitely, because we have to figure out
who's getting what. There's also math done when people take commissions,
(04:31):
which they are allowed to do either or both in
the document and under New York state law. Actually, New
York State law is pretty generous when it comes to
in a state commission five thousand of the first hundred thousand,
four thousand of the next two hundred thousand, and so on.
It's a word problem again. Math, Yes, so there is that,
(04:57):
But I mean you had some exposure to this, you know,
some small exposure to this, and now it's your primary
practice area at least for now, correct. I know you
have some interest in doing some planning. I do some
other things. So we'll let you learn the end. I
guess first, right, So, that in our world, learning a
(05:20):
state administration is particularly instructive because you see how everything
works or you see what hasn't worked, definitely a lot
of cases. So we try to keep people out of probate, right,
and there's a lot of confusion about what that means. Right.
There are people who think that they have a will
so that nothing goes to probate. That is one wrong
(05:45):
So sorry if I hurt your feelings had that thought,
but that you could not be more wrong about that.
So when we're doing a trust administration, hopefully people have
given us the information that we needed to make sure
that everything was tied to the trust. They've gone through
the funding process, and essentially we might be creating downstream
(06:06):
trust which we call beneficiary control trusts, which we probably
should come up with a better name for at some point. Yes,
it's a bloodline trust essentially, and I know a lot
of people like that terminology better. And it's an asset
protect a trust, which is a big deal. So if
your son or daughter marries someone who is less than
(06:31):
trustworthy or not good with money, or I don't know,
has terrible ideas, you can protect the money from that purpose.
So that is a big part of what we do
in the office is protect downstream money because if I've
learned anything, the hard part is accumulating the money. When
(06:53):
people inherit money, very few people treat it as if
it was money that they earned themselves. They don't. They're
much more willing to spend inherited money in a lot
of cases quickly. So that can also be restricted if
you so choose. It's important to know. But if you
(07:14):
don't do anything, you have none of these options, and
we end up in what's called an administration, which is
the absence of a will. And we've had to counsel
a lot of people when a spouse and children exist
that if there's no will, everything doesn't go to the
wife or husband, whoever it may be, which is surprising
(07:35):
to most people, but that's the way it is. And
it can be really messy if there are minor children,
because then we have to get guardians appointed, and you've
dealt with some aftermaths.
Speaker 4 (07:46):
Of that, and the result of that is, you know, honestly,
that ends up costing the estate more money anyways, and
you know that's not necessarily their wrongdoing. Maybe they just
hadn't gotten around to that. But in the end, it's
a hurdle that.
Speaker 3 (07:59):
They have to.
Speaker 2 (08:00):
Yeah. The only people who bank out in that situation
are lawyers. Yeah, and we know, we know how you
feel about lawyers, so we are we're trying to help you,
in the words of Jerry McGuire, help me help you.
Speaker 4 (08:11):
Well to that point, I think we do a very
good job of advising our clients of actually funding trusts,
because you know, since starting here, you know, three months
ago or so, I've been talking to some friends of
mine and everyone just thinks, oh, but I have a trust,
so my house is in the trust, Like, well, no,
you actually have to take the steps to title the
(08:32):
house into the name of the trust, or we're going
to be dealing with what Aaron is saying, going through
probate or if you don't have a will through probate,
but the administration side of it. So I think it's
very important to know that just because you have a trust,
you still have to take the steps to actually put.
Speaker 2 (08:49):
Things in it that's right, and you know, at a minimum,
and update beneficiary designations, right because not usually we are
not titling everything in the name of an irrevocable trust. Right,
So if we're protecting assets depending on where you are
in life, how old you are, how healthy you are,
what your goals are. You know, the older you are,
(09:11):
the more we're going to tie into your trust. But
we're always leaving a bank account outside and that you
need to make sure has a beneficiary on it. If
you have a retirement account, you need to make sure
you have multiple layers of beneficiary on it. Unfortunately, we've
had a few cases where retirement accounts have had to
(09:32):
go to probate because they were either they were left
to no one or more typically they were left to
a spouse and no cogingent beneficiaries. And it's just a
nightmare that can easily be avoided.
Speaker 3 (09:45):
Easily be avoided.
Speaker 4 (09:45):
I would say, you know, talking to anyone like I say,
now you know, friends, family, always at a beneficiary or
a joint owner if you know, that's something you feel
comfortable with. But in the end, it makes it easier
for your loved ones after your pass.
Speaker 2 (09:59):
Yeah, can be tricky because if you that gives people right,
that other person rights to the account at that very moment,
that's right and it has happened. So and even in
a great situation, if you're giving a son or daughter,
you know, a joint account. Then when a child, their child,
(10:21):
your grandchild goes to college, they would have to disclose
that as an asset of theirs as well. So that's
going to half count, and that's not really ideal generally speaking,
although I mean, I think the financially world is going
to look a little different coming in the future now
with all these limits on loans, et cetera. So but
just something to be aware of, because I do think
a lot of people get tripped up on that.
Speaker 3 (10:42):
Sure.
Speaker 2 (10:46):
So what we're going to talk about today are really
a lot of real estate issues that come up related
to planning, whether that be how people own a property
and how sometimes multiple people own a property can still
end up in probate for just to share, which is
a nightmare, or issues in the States with properties which
(11:10):
there are many and not sometimes easy solutions. We also
probably will, I think towards the end talk about vacation
properties and things we want to do with those and
how you can set that up not to be a problem,
because there are a lot of times those properties are
someone's life dream and they want to leave them to
(11:33):
their kids, but there are competing interests. Maybe geoggraphical differences
where one kid can't really use it very easily, or
one kid can't afford for all of it, right, So
those things need to be thought out and how you
do that. So we're going to be coming up on
(11:55):
our first break, but when we come back, we'll delve
into the different ways that people can own a property
deed wise at least first, and see the positives and negatives,
because it's not necessarily one is better than another for
any for all situations. It's not. But we need to
think about those things, and we need to understand what
(12:16):
might happen when we owned property with other people upon
one or another's death. So that's where we're going. This
is Life Happens Radio. I'm Aaron Connor from Pierre o
connor and Strauss and we will be back right after
this break. Welcome back to Life Happens Radio. Aaron Connor,
Pierre O'Connor and Strauss joined by our I think newest associate,
(12:40):
Adriana Mahalak. That will not be true soon, yeah, because
I keep calling them boys. I'm sure that they would
not love that. But young men. Have two young men
that'll be starting with us soon that were law clerks
with us. So they've decided that they like what we
do and want to do it, and so we will
(13:03):
be training them up and they will be the newest people.
Speaker 3 (13:07):
Thank goodness, it's about time.
Speaker 2 (13:10):
So always always daunting being a young attorney people. Really
it's it's pretty stressful profession, especially when you're right out
of school, because you really have no idea.
Speaker 3 (13:26):
I mean, well, and people call you.
Speaker 2 (13:27):
Out on it, right, I mean, you've learned a lot
of things, but you've learned a lot of things that
you're never going to use as well. I mean, depending
on what area of practice you go in, right, you
have to take criminal procedure, you have to take evidence. Well,
if you're doing a state planning, those things really don't
matter very much hopefully criminal procedure not at all. So
(13:48):
you know, contracts marginally valuable and what we do, but
mostly you know New York practice marginally valuable. So they
will have some knowledge, but it will be incumbent on
us and them to help them alone. They will have
a lot of resources, which is good. That's not something
that I had where I started. The firm I started
(14:10):
at was more like, here are your twelve files for
today and you know figured out. Oh, by the way,
there's a court appearance. I wanted them tomorrow. I'm sure
it'll be fine. Thanks, Thanks for so we don't do
it like that, think or swim. Yeah, that was pretty old.
That was the old school way though there really wasn't
like a lot of mentorship necessarily not definitely not the
(14:34):
better way to do things.
Speaker 4 (14:35):
I think something too is just learning how to be
an attorney. I think a lot of that is client communication,
sure as well. So I think i've you know, had
some background or some time to learn that. Yes, and
I'd like to think, you know, clients maybe might not
be going through whether it's this area or another area
of law, every day. They don't know necessarily the ins
and outs of what we're talking.
Speaker 2 (14:55):
About, and they might not be having their best day
because in a lot of our situations, either someone needs
long term care, they're not doing well physically, or they've
passed away, or in my case, we're maybe doing a
guardianship because they lost capacity and people are trying to
take advantage of them. So it's it's not necessarily that
we see people on their best day. We see a
(15:15):
lot of people doing proactive planning and that's easier and
better frankly, much more pleasant conversation, although we still have
to say what happens when you die? Oh, and what
happens if your kids die?
Speaker 4 (15:25):
You know.
Speaker 2 (15:25):
I mean, so that part never really is great. But
you have to know who you're talking to. Communication obviously
very important, and what kind of mood they might be in,
you know, and how you carry yourself in both how
you deliver news, whether it's good news or bad news,
(15:47):
and how you carry yourself in you know what you're
doing right, and we don't put young people in a
position where to pretend they know what they're doing right.
Someone else will be there to help them through that.
But it's important that the attorney convey that their knowledge
and experience in the situation because it's comforting.
Speaker 4 (16:09):
To people in our area too that you do actually care,
like you want to get help them get through this
difficult time.
Speaker 2 (16:15):
Yes, well, a lot of people can't grieve until after
this is state administration. I mean, they're grieving along the way,
but there's no closure or finality why this is open
and the longer it takes, the longer they're going through
that process. Right, So I mean, we do play therapists
a little bit here and there. It's probably not my
best skill, but we do do it. So. I had
(16:41):
mentioned though that there are different types of deeds because
we're going to talk about real estate, right and at
least coming to mind to me, there's predominantly two types
of holdings that we see, joint tenants or tenants in
common right. Correct, there's a special quote unquote tendency by entirety, right,
which means you're married, but it's really for all intents
(17:03):
and purposes of joint tenancy right, right, So can you
give the listeners some ideas some differences between joint tenants
and tenants in common?
Speaker 4 (17:13):
Sure, I'd be happy to so the joint tenants with
right of survivorship. As Aaron said, it's similar to the
when you're taking title when you're married. That means that
when one of the title holders passes away, the survivor
becomes the automatic owner of the house one hundred percent.
(17:33):
You don't have to go through probate in that instance,
you don't have to sign another deed, which I think
a lot of people think it's an automatic transfer of ownership.
Speaker 2 (17:41):
Yes, we say by operation of law.
Speaker 4 (17:43):
By operation of law and then tenants in common differs
on the fact that when let's say the first one
passes away, they're shared is not automatically, by operation of law,
transferred to the survivor. Instead, their share follows the estate
plan or goes to their next of kin if they
don't have an estate plan.
Speaker 2 (18:03):
Right, So that may and often cases goes to probate. Yes. Right,
So we see this a lot in Sometimes people own
property and get married later. Well, it doesn't automatically convert
to a tendency by the entirety if you owned it
as tenants in common, so that can be a big
trip up to people. It's more often than not we
(18:25):
see siblings inherit property and decide to keep it, and
if you're five of you, you're going to own it
as tenants in common usually right, And this is a
conversation I'm often having in planning consults. How do you
own that property? And then people look at me like,
what do you mean now I have a deed? Right? Well,
that's not the end of the answer, it's the beginning
of an answer. But more often than not, if five
(18:50):
people own it, it's tenants in common, and then when
somebody dies it goes.
Speaker 3 (18:56):
To their estate right.
Speaker 4 (18:58):
I used to say a closing because typically you know,
at the closing table where the seller signed the deed,
we're saying, how do you want to take title? And
I would explain the two you know, joint tenants with
right of survivorship, the other one to use the automatic
owner with tenants in common. Let's say they're not married,
they don't have children. Does a survivor really want to
own it with the deceased mother in law or their
(19:19):
mother in law?
Speaker 2 (19:20):
So I've seen all wild ones. That's very possible.
Speaker 4 (19:23):
And when I would say it like that, you know,
people took some time to consider it, and it was always,
for the most part, joint tenants with right of survivorship.
But it depends on each situation, like you were saying.
Speaker 2 (19:33):
Right, And I think a lot of times in this
inherited with inherited, that conversation doesn't happen. Right. A lawyer
just prepares a deed right, usually as tenants in common,
because that's the default, unless you really and once in
a while it is that these five people are joined tenants,
and then I have to explain, well, that's I call
that a winner take all scenario. Right, whoever survives gets
(19:58):
the whole property, and that it's usually not the intent.
It may occasionally be that. I mean, if all five
people didn't have children, or all five people you know,
only one of them had children that were interested. Maybe,
But generally speaking, you know, if five of you inherit
mom and dad's house, you're not going to lead that
(20:18):
entire interest to the survivor of.
Speaker 3 (20:20):
Everybody, depending on the situation.
Speaker 2 (20:23):
Right, and by the way, it's a good way to
end up with a lean on a property for several reasons. Yes,
someone doesn't pay property tax, right, and in that case,
everybody owns a fifth they all owe a fifth.
Speaker 4 (20:37):
Right.
Speaker 2 (20:39):
Somebody goes into a nursing home, they could lean their
portion of that property. One wrinkle, though, from a medicaid
eligibility standpoint, is that if you own property with people
who refuse to sell it, it's exempt. Okay, So this
is like a it's not one that you want to
play to rely on because it's not a good plan.
(21:03):
But if you and your brother own a property and
your brother's well and he says, now I'm not selling that,
then no one's going to buy your half interest. It's
not really marketable. So it's exempt. But if you and
your brother are similar ages and then he has a
problem and you have a problem, you have to sell
the property and you're in some financial difficulty. So it's
(21:29):
okay as a stop gap measure, but it's not something
you would proactively plan to use.
Speaker 3 (21:35):
Understood, So.
Speaker 2 (21:39):
Many many issues come up with these property ownerships. I
mean there's also deeds where people own the building attached
to the land but not the land right, and associations
we've had to transfer, mostly like Lake associations. Okay, that's
(22:00):
becomes a little you know, strange. I did encounter a
beach house in New Jersey once where I don't know
which church I don't know, but I want to say
it was a Protestant church owned all the land in
the town, literally all of it, yep. But there were
plenty of houses there and these people owned the house,
(22:21):
but they didn't own the land that the house was on. Yeah.
I would never really be comfortable with this scenario like
that in my own head. I mean, many years ago,
if local people might remember, there was a place along
the Mohawk and the Old Canal in a half Moon
and where Kraus's restaurant was, where there were a number
(22:42):
of houses there on the river, but those people did
not own the land. They only owned what they had
put on the land. And whoever owned Krauss or the
land at the time decided they were going to build
big apartments there and you needed to get off the land,
and it's not easy to move a house. I think
(23:04):
most of those people lost whatever they had built up
as far as structure. Yeah, but it is kind of
foreseeable at the same.
Speaker 3 (23:13):
Time too, right, right, I don't know who advised them.
Speaker 2 (23:15):
To exactly right. Better advice would be like, And by
the way, no, those whatever they just wanted to build
never got approved. Oh wow, messy situation, definitely so. But
it's just kind of sometimes the most instructive things are
the bad decisions that other people have made. Right, hopefully
(23:37):
it's not your bad decisions. Better instructive they can be,
but those are things that you want to think about
before you look into things. That's why we have title reports.
That's why we figure out can this person actually convey
what they say they're conveying in a real estate transaction?
And maybe when we come back after the news, we'll
just talk briefly about that, because I think that's important too.
(23:59):
There has been and more recently quote deed fraud out
there too. That's something that probably should just touch on
because I know a number of older people have brought
that up. So we're going to be coming up on
the news after that. We will continue to talk about
real estate issues related to estates. This is Life Happens Radio.
(24:22):
I'm Aaron Connor with Pierre O'Connor and Strauss and we'll
be back right after this. Welcome back to Life Happens Radio.
Aaron Connor, piro'connor and Strauss joined by brand new associate
Adron Mahleik, and we are talking about real estate issues,
some problems, some solutions. Hopefully we can give you some
(24:46):
guidance so you don't make mistakes that we've seen people make,
and that can be titling things incorrectly. It can be
not thinking about who might be receiving a share right.
So if you have a will and you leave something
five ways and somebody is then disabled at that time,
(25:06):
we have a problem. We're going to have a lawyer
appointed for them, a guardian at item to make sure
that they're getting what they're supposed to be getting or
they're in a nursing home, same treatment, or they're a miner,
same treatment. So in some cases you're leaving something to
five kids, but one of those kids predeceases you, so
there are children step up to take that share. They're miners,
(25:30):
we have a problem. Those are all reasons to use
a trust because we don't encounter guardian end items with
a trust. So it's important really to think about what
you're doing, what might happen, and a little more money
upfront saves a lot more money on the back end.
I can say that confidently after about fifteen years of
(25:52):
doing this, So we encourage you to do some planning,
certainly if you want to hear about how to avoid
a nursing home and keep your assets. We do have
a seminar coming up on August sixth at the East
green Bush Library and also on August thirteenth at the
Guilderland Wise MCA. You can get more information about those
(26:12):
at our website that's puro law dot com, p I
E R R Law dot com, or you can always
call the office five eight four five nine twenty one
hundred or send an email to info at puro law
dot com. So that commercial part is over wunder back
to talking about real estate. So, just from its most
(26:37):
basic thing, you have to make sure that the person
you are purchasing from has title to the property. And
so what's generally done.
Speaker 4 (26:48):
To show that, Well, typically there's a title search done,
but even before that, what I saw a lot in
real estate, you know, whether it was the purchaser side
or the seller side was the purchaser would say, oh,
the seller's in a state, so all's fine, we'll get going.
(27:09):
And I said, well, we have to make sure we
get title insurance. Of course, Well why do I need that? Well,
just because someone passes away and they have a will
that named someone as their executor doesn't mean that that
person just automatically has the authority to act on behalf
of the estate or sell it. And I think that
is a big misconception that people do have. I said, no,
(27:30):
we need to make sure that they actually went through
the probate process, They've been given the letters testamentary or
administration having the actual ownership or the authority to actually
sell the property. And I know that's one thing that
the title companies usually will require. They want to see
copies of all of those documents and via that title search.
(27:50):
They'll look through the chain of title, make sure each
person's ownership interest from dating back forty years, they have
accurately conveyed their of the property, and that there were no.
Speaker 3 (28:01):
Outstanding leans or judgments hanging on there.
Speaker 4 (28:04):
Because if you buy a house, right, but the leaner
judgment that becomes yours.
Speaker 2 (28:08):
That's right. So there's two I think important things there,
and we'll talk about the second thing first, and that's
leans or judgments. Right. So a lot of times we
see people had a mortgage, they paid off the mortgage,
but the release doesn't get filed yep, right, which can
be a problem. Has to be tracked down a lot
of the time, and in the banking world, many of
these banks have been bought by other banks, so sometimes
(28:29):
it takes a long time to track that down. Sometimes
it's deemed an ancient mortgage, yes, which is not really
being over forty it's kind of offensive. Forty years old
is ancient, but uh, you know, that's how it goes.
So that's the terminology.
Speaker 3 (28:46):
Yes, you know.
Speaker 2 (28:48):
So it's important that none of those things are out there.
There are tax lians, there can be judgments. You know.
One thing we haven't really touched on is life state
deeds and I as a firm, I along with Lou
we decided that we basically never do life a state
(29:10):
deed because it doesn't really work very well. If you
don't get through or five year look back, you have
to have people sign back property to you, they may
not be around to do so. I had a case
where a woman put the remainder interest in her son.
Her son died and that remainder interest went to his
spouse and she wanted her remainder interest back and the
(29:37):
spouse said, no, I'm good, right, right, she has no
legal obligation to give it back. Wow, So it doesn't
work well that way. I've also seen where there's four
or five people with the remainder interests and one gets
a judgment it's a problem, and it just is not
it's a bad substitute. It's kind of it's just it's
(30:01):
just not something I'd ever really be comfortable putting my
name on, and unless there was really really strange circumstances.
So it's not a good idea. Generally speaking, we don't
do them. So you were talking to my Goatsia and
(30:21):
I'm getting old. We talked about that's right, leans, right, Oh,
and we're talking about ability to convey. Yes, oh, now
I know. So we have had deeds where people have
carved out pieces, right, So mommy, right, So mom and
(30:42):
dad have one hundred acres. Johnny and his wife want
to start have their own house, so they give Johnny
and his wife five acres, and then they give their
daughter and her husband five acres. Right. It gets pretty
complicated to figure out whose is what. And so this
has come up recently. A deed was done that was
(31:06):
supposed to convey everything I believe, correct, all right, title
and interest, yes, right, but it did not. So now
we're in a state situation and we have to figure
out one what wasn't conveyed. Is there a description for
(31:27):
that piece of property? Yes, separately, Yeah, because in some
cases you might have to have a survey done and
a map done and a new description created for that.
Speaker 4 (31:38):
I mean, I don't know how antiquated it is if
someone's going to require updated one from.
Speaker 2 (31:43):
The stone three feet off the road, you know, I
mean people though right from the tree with I don't know,
but that's really and then the safest thing to do
in those situations is just repeat that, because you can't
get anything wrong if you repeat it.
Speaker 4 (32:00):
Sometimes title requires an updated one, which no one's happy
to get a survey, but hey, you want to know
what your property lines are, where your boundary lines are,
and so that's in short as well.
Speaker 2 (32:09):
So and that can happen all the time. I can
tell this story that so the house that my grandparents
owned and that my dad grew up in was built
on a lot that was originally fountains for the house
next door. And that's that's a true story. Fountains fountains. Okay.
(32:29):
So the house next door was a manor house. This
is not in the South, it was. It was in
Saratoga County, Okay. But you would walk in and there
was a giant staircase and there was a statue of like,
I don't know, a god or goddess and the light
bulb was literally coming out of their hand. That was
like the light for the banister.
Speaker 3 (32:47):
Oh my goodness.
Speaker 2 (32:48):
So it was, you know, and there was a in
the back there was like a carriage house that I
was always told that during prohibition was like a you know, gamp,
like a casino. And yes, so that house had a
big stone fence, like you know, thick, big pieces of block.
(33:08):
And when they sold off the Fountain lot, I don't
know what else to call it. And the woman who
built the house, who owned it before my grandparents put
like a Cape cod style house on it, that fence
covered the front part of her long okay, right, So
the fence was no longer the property line for the
for them, right, sure. And so my grandparents bought that
(33:30):
house in nineteen thirty nine and people then in the
late probably early nineties came and said that that stone
fence was on their property. Oh my, And I'm really
wonder what that lawyer was telling those people, because that
fence was well over one hundred years old at that point.
Speaker 3 (33:51):
Yeah.
Speaker 2 (33:52):
So that's what's called adverse possession. And without getting overly complicated,
if you have something like that and it's over your
property line conspicuously for a period of time ten years, yes,
then you own that property, right And I don't know,
maybe they didn't care when they put the fence up,
(34:13):
who knows, right, Yeah, but by the time it was
over one hundred years ago, it didn't matter. First of all,
no one was moving the fence.
Speaker 3 (34:21):
No one could move it exactly, and.
Speaker 2 (34:24):
It had been way too long, So I just don't
even know. And it's not a good way to really
introduce yourself to your neighbor. And we're talking about an
encroachment of possibly like one foot by six feet maybe
you know what I.
Speaker 3 (34:37):
Mean, nothing else to do.
Speaker 2 (34:39):
Yeah, it's not like a big deal.
Speaker 3 (34:41):
No, So.
Speaker 2 (34:44):
You know, getting a survey not a bad idea. But
you may find some things that you're unable to fix,
let's say too And I mean, if you really want,
you could ad just.
Speaker 3 (34:54):
A boundary line to reflect that you could.
Speaker 2 (34:56):
But I mean I don't know that most people would
go to that trum so anyway, So there are all
sorts of wild things that can happen, you know. The
deeds that don't convey everything or that accept a piece
out always make things more complicated and probably do require
(35:18):
a title report and a lot of these instances to
be sure we know who owns what. And lots of
times people come in and they own these little landlocked
parcels next to their parcel. They're not combined. We talk
about combining them, and that's certainly something that we combine
(35:39):
things on deeds a lot because from a medicaid perspective,
your residence is exempt if a well spouse is living
in it. So Dad needs to go to a nursing home.
Mom's got two or three parcels, but they all touch
each other. Well, we'll put them all on one deed
because guess what now they're all exempt protected, right, gotcha.
(36:00):
But like those are tricks, I'm not sure. You know,
most of the time people have gone to trouble to
separate parcels. They can still do that. The deed just
reflects that there's three separate parcels and if they wanted
to sell one, they still could. But sometimes it's actually
beneficial to put them on one deed for that medicaid purpose.
(36:20):
So when we're planning, we are also trying to think
about what might happen in the future and what the
most likely scenario is. I mean, nobody really knows, right,
we're just going to do it based on age, health assets,
existence of long term care insurance and whatever else. So
those things are important. Those are discussions we should have
(36:42):
even you know, when we're doing deed work, Like Adrianna said,
are you going to hold this as tenants in common
or you know, join tenants? That that's important and a
lot of people just have no idea.
Speaker 4 (36:54):
I recently talked with a relative of mine and I
did get her consent to talk about this, but not
give too much confidential information. You know, from a prior marriage,
she had one child, Her husband from a prior marriage
had two kids together.
Speaker 3 (37:11):
They had one, so four kids all together. In her will.
Speaker 4 (37:14):
She asked me to take a look at it. She
decided to reference all the four kids as her children.
You know, that happens wonderful because you know, step kids
typically don't have any rights. Really is what we say
in the will, but really the only asset was the house,
and it said, you know, to to.
Speaker 3 (37:32):
The four children. Per sturpies with that language.
Speaker 4 (37:35):
We all like saying that if they predecease, her goes
to you know, their next of kin. And I was
thinking about it and one of the two step children
it's not married, no children, So I said, hmm, well,
let me think about this. If she were to predecease
for some reason, her share would go to her mother,
(37:58):
which is my relatives husband's ex wife.
Speaker 2 (38:02):
Oops.
Speaker 3 (38:03):
And I said, you know, you were doing the right
thing there, but let's think about that now. Is that
going to happen?
Speaker 4 (38:08):
Who knows, But it's those little things that you have
to like, will she have a share in your house?
Speaker 3 (38:13):
You want your husband's ex wife. No, that is not
what she wanted.
Speaker 4 (38:18):
She had no idea that was a you know, potential
event that that could arise. So granted she is having
that document edited, but I think that was interesting to think.
Speaker 2 (38:29):
About it and something she would have never considered. So
I think it's a good time to take the last break.
This is Life Happens Radio Aaron Connor, Apio, Connor and Strauss,
and we'll be back right after this. Welcome back to
Life Happens Radio. Aaron Connor, Apio, Connor and Strauss, joined
by associate Adriana Mahalek. We have been talking about real
(38:50):
estate issues with planning and estates, and I think probably
one of the biggest ones are vacation homes as we
kind of generically call them. Could be lake property, it
could be a cabin, it could be I don't know,
a ranch, right, don't running too many ranches, but no,
(39:11):
not for me. You could own an island. I don't know,
that's for me, right. So, you know a lot of
people work their life to make sure that they have
a beach house, you know, a lake house whatever, it
may be a cabin. And when I say cabin, we
had clients a number of years ago that were very
wealthy people, very and they had quote three cabins on
(39:36):
their property that were thirty two hundred square feet each.
So I was like, yeah, I don't know if i'd
call that a cabin, but you know what, they called
it a cabin. I just had to roll with it.
But those things can be complicated assets to leave behind
for many reasons. Right. Obviously, the more people who have
(39:58):
an interest in the property, the more complicated it can be.
So you have to think about a number of things
who might use this property, right, Because if you have
three kids and one of them lives in Utah, they
may use the property, but they may not either, and
(40:20):
two kids that are local, right, it may set up
a kind of an unfair dynamic.
Speaker 3 (40:25):
As far as goes.
Speaker 2 (40:28):
We also often have issues with funding. Sometimes property taxes
on an up keep on a place on a lake
can be pretty expensive. Especially let's just say like if
it's not a year round camp, right, you have to
open it up, you have to shut it down. All
of it has to be done correctly. You may be
(40:49):
employing somebody to do that. You know, there may be maintenance,
just in the form of I don't know, lawn cutting
if you have a lawn, right and eventually some things
are going to need be repaired replaced, and you have
to kind of think of all that. So in the
best case scenario, people leave aside a pot of money
for that for a period of time. Right, So I've
(41:09):
seen people leave one hundred thousand dollars or something to
fund a property for a period of time, whatever that
may be. Right, some places, the taxes are less than
New York almost everywhere. So for instance, right, I hope
to eventually own a piece of property in Delaware, the
(41:31):
property tax on a million dollar house in Delaware somewhere
between fifteen hundred and eighteen hundred dollars. Okay, significantly different
than you, very different. They do have a small flip
tax on the on the seller, usually.
Speaker 3 (41:48):
As more than the transfer tax.
Speaker 2 (41:51):
Yeah, okay, it's a two percent of the transaction, huh.
And I think it gets more often split between buyer
and seller. But that all depends on the market. Right.
If the market's down, the buyer is going.
Speaker 3 (42:05):
To have to eat that one time though.
Speaker 2 (42:07):
Yes, exactly right. And if you know it's there. And
I mean even so, if it's a million dollar property,
I think you're talking about fifty thousand dollars, which is
not nothing. I'm not saying that in any way, shape
or form. But if you're spending a million dollars, it's
probably not going to stop you from spending so and
if you're spending five hundred thousand, then it's it's half that, right,
(42:29):
and it's you know, it's just one of those things.
Like when my parents bought a house in the villages,
there was also a bond that they had to then
take on a portion of because that's how the villages
were built through bonds, and then the builder of the
villages passed the savings or the expense in this case
of the bond onto everybody who bought, which is you know, smart.
Speaker 3 (42:52):
Yeah.
Speaker 2 (42:52):
So, and most people have paid off their bond well
and ahead of their house if they didn't, if they
got a mortgage, right. So there's all sorts of little
things in different places that you need to think about too,
you know. And even here like in Sacondaga, a lot
of people buy places and they want to knock them down. Yeah,
(43:13):
and that is not necessarily as easy as you might think.
The stories I've heard is generally you have to keep
one wall something like that. I don't I'm not going
on record as saying that that's the rule, But there
are rules about what you can do and what you
can do, and you can't necessarily just put up a
giant house on the property that you you've knocked in.
Speaker 4 (43:33):
And I think too, you know a lot of them.
I don't know if people just presume that they automatically
have lake rights or anything like that, but you actually
or dock rights. Do you have deeded lake rights saying
you can cross over this person's property to get down
to the.
Speaker 2 (43:46):
Lake or and let's talk about that for a second. Okay,
how exciting is that? Like if you're the person on
the lake and these people get to traverse your property
right like you're having a party and they're just going to, hey,
you having a party?
Speaker 3 (43:58):
And who?
Speaker 2 (43:59):
Right?
Speaker 3 (43:59):
Always the question? I feel like I don't love that
dive deeper into Yes.
Speaker 2 (44:04):
You need to be cognizant of those things.
Speaker 3 (44:06):
Just can't take someone's word that oh yeah, sure, yeah
you can. You got access to that doc right there.
Speaker 2 (44:11):
Yeah, No, it's very important and you know, functionally when
people have access across your property to the water is
not great because there's usually that could be at any
time of day or night, and any time of year.
There's very little restriction, and that's usually done as an easement,
but I don't know, it could be done as probably
a license or other things too, So lots of things
(44:35):
to think about. Our best strategy for passing on a
vacation home, though, is to put it in an LLC
with an operating agreement. And maybe at the first generation
it isn't so bad, right, if it's just two kids,
(44:56):
they can probably figure it out. Maybe they can even
be there to yeah, there at the same time, right,
depending on how get along. Right it's fourth of July weekend,
because those things become important.
Speaker 3 (45:08):
Sure who gets it that holiday?
Speaker 2 (45:10):
Right? But next generation it can be a little trickier, right,
because there might be six hands in the till at
that point, and they might be in many many different
places and again many different affordability levels. So when we
do that, we create an operating agreement that one allows
for a structure of determining who has it when right,
(45:31):
there's usually some kind of rotating system about who has it.
Fourth of July, Labor Day, Memorial Day, that kind of thing.
There is verbiage about what happens when people don't pay
their share. Usually what happens is it diminishes their interests
by that amount. Right, So that can become kind of
(45:54):
a tricky thing because there can be room for dispute there, right,
I say you will five thousand. You say, well, I
think it's only three thousand. I mean in that area,
we're not talking about anything that's worth really disputing in
a legal sense. Right, There's definitely plenty of room for
hurt feelings no matter what. So there are a lot
(46:16):
of things that it's not just as simple of here.
Here's the lakehouse because and you know, some people want
to restrict whether it can be sold or not too yes, right, yeah,
they think of this as their legacy or their family
house in the family. Right, And you know that may
or may not be possible. And it also depends on
(46:37):
what other assets there are. So if you have this
million dollar lakehouse and your other assets total less than
a million dollars, then more likely than not, one kid
is not taking the lakehouse, yeah, right, unless they have
a pool of other money to pull from, and it
might have to get sold, so it's in And even
(47:00):
many people we see now bought a property, let's say
on Sacondaga, for a number that was very low compared
to today, and if you know their child had to
buy out of that property, they probably might not be
able to do that. You may see somebody who paid
fifty and it's worth three fifty, right.
Speaker 4 (47:22):
I mean, something I think to consider as well is
the fact that you know, in New York, when someone passes,
the ownership interest immediately vests in the airs. Granted, it's
subject to the administration of the estate, but so if
the executor, you know, you think you have the authority
to sell the house, do whatever. Well, when it comes
(47:42):
time when you're at the closing table, those heirs are
going to be required to sign off on those documents
saying that they agree for it to be sold as well.
Speaker 2 (47:50):
Right, and we only have a couple of minutes of left,
But I do think we should briefly touch on when
there is an heir living in the property. Please, in
all respects try to avoid that situation because generally speaking,
that person does not want to pay They honestly they
(48:11):
owe rent to the estate. Yep, okay, which almost never
gets paid.
Speaker 3 (48:17):
Someone needs to be paying taxes.
Speaker 2 (48:19):
And a lot of cases that person wants the house right,
But the only way to do that fairly is to
get a real appraisal and then subtract whatever their share
would be from that, and they have to pay the rest.
And you know, in some of these cases there's a
mortgage involved as well, and who's paying the mortgage nobody,
(48:41):
So then we have a foreclosure issue which can probably
be averted, but you know, probably we have a lot
of stress in these situations and diminishing equity.
Speaker 3 (48:51):
And then you know, are they just they're going to say,
well then.
Speaker 2 (48:53):
A victim right, which we know is almost impossible.
Speaker 3 (48:59):
I mean a lot of time and money.
Speaker 2 (49:00):
Yes, it's just not I don't know, it's not a
good time to be a property landlord unfortunately. So no
no political commentary there, just that if you are trying
to get somebody out for nonpayment, it's a very difficult
time to do that. Buckle up, yes, and get your
check book out from all the rent you're not getting paid.
(49:21):
So certainly some things to avoid. So just to recap,
do some planning, right, know what your deed says. If
you are a tenant in common and you want that
asset to go to your estate. Okay, you can be
a tenant in common and assign that asset, that portion
(49:41):
of your asset to a trust, which can help quite
a bit at least for your planning. Doesn't help the
other tenants in common, but they need to do their
own trust. So come on in, let's do five trusts.
If you are a tenant by tendancy by the entirety,
then you're probably going to be okay, assuming that's what
you want winner take all or a husband and wife.
(50:02):
If you have other property issues, then we need to
have you come in. We need to talk them out
to find what the best solution is, because there's no
one solution for everybody. If you have any questions, we're
happy to meet with you. Five one, eight four nine,
twenty one hundred pure O'Connor and Strauss. I'm areon Connor
and we'll be back next week. Have a great weekend, everybody.
Speaker 5 (50:24):
You've been listening to Life Happens Radio, brought to you
by the law firm of Piero Connor and Stress. For
more information or to contact and attorney at the firm,
visit Piro Law dot com or call five one eight
four nine twenty one hundred. Please join us again next
Saturday at nine am for Life Happens Radio on News
Radio E ten and one oh three point one WGY,
(50:46):
and you will be prepared
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