Ask Me Help Desk - Mother's debts

Long story, I will try to make it short and to the point. My mother died 12/31/07, leaving close to 40,000 in credit card debt. We live in Michigan. The house is in a Trust with us 6 siblings, and for me to live in for my lifetime. I must pay all taxes, house insurance, $25,000 lien for home repairs, and monthly expenses. There was no money left in her checking, and there are not valuables in the home to sell. Can the credit card companies make us sell the house to get their money? I know the $25,000 lien comes first.

I quit my job 2 1/2 years ago to take care of her. I have had no income for this time. Michigan has a law that states:

Homestead allowance

Pursuant to MCL 700.2402 the surviving spouse of a decedent who was domiciled in this state is entitled to receive a homestead allowance of $15,000. This amount shall be adjusted annually for inflation beginning January 1, 2001. If there is no surviving spouse, each minor child and each dependent child of the decedent is entitled to a homestead allowance equal to $15,000, as adjusted annually for inflation, divided by the number of the decedent's minor and dependent children. It should be noted that a dependent child means an adult child who was dependent upon the decedent. The homestead allowance is exempt from and has priority over all claims against the estate including other allowances, administrative expenses, funeral expenses and all other claims. Therefore, it is the top priority for disbursement from an estate. A homestead allowance is in addition to any share passing to the surviving spouse or minor or dependent child by the will of the decedent, unless otherwise provided, by intestate succession, or by elective share. How the determination of what assets are to be used to make this disbursement will be discussed later in this note.

I don't think the paragraph you quoted applies to the facts you have provided. If the house is in a trust, then your mother did not own it at the time of her death, and it will not be an asset of her estate. You may want to check the deed records in your county and make certain that her transfer of ownership has been filed.

Quote:

Originally Posted by kentuckykaren

Long story, I will try to make it short and to the point. My mother died 12/31/07, leaving close to 40,000 in credit card debt. We live in Michigan. The house is in a Trust with us 6 siblings, and for me to live in for my lifetime. I must pay all taxes, house insurance, $25,000 lein for home repairs, and monthly expenses. There was no money left in her checking, and their are not valuables in the home to sell. Can the credit card companies make us sell the house to get their money? I know the $25,000 lien comes first.

I quit my job 2 1/2 years ago to take care of her. I have had no income for this time period. Michigan has a law that states:

Homestead allowance

Pursuant to MCL 700.2402 the surviving spouse of a decedent who was domiciled in this state is entitled to receive a homestead allowance of $15,000. This amount shall be adjusted annually for inflation beginning January 1, 2001. If there is no surviving spouse, each minor child and each dependent child of the decedent is entitled to a homestead allowance equal to $15,000, as adjusted annually for inflation, divided by the number of the decedent's minor and dependent children. It should be noted that a dependent child means an adult child who was dependent upon the decedent. The homestead allowance is exempt from and has priority over all claims against the estate including other allowances, administrative expenses, funeral expenses and all other claims. Therefore, it is the top priority for disbursement from an estate. A homestead allowance is in addition to any share passing to the surviving spouse or minor or dependent child by the will of the decedent, unless otherwise provided, by intestate succession, or by elective share. How the determination of what assets are to be used to make this disbursement will be discussed later in this note.

Don't think this section of law pertains to your situation - the person to ask is the Attorney who wrote the Trust. Exactly what kind of trust, the phrasing will be important. Some trusts the original party holds the property until death; some trusts they do not.

YOU and the other heirs are not responsible for any of her debts, only her estate is responsible. So the question is whether the house was part of the estate or not. From your description its likely it wasn't, but the attorney who drew up the trust can advise you for sure.