[mfx]

Hi,

I currently reside & own a co-op in the NYC area. The value of the co-op is about 160k, with 2 mortgage balances of about 125k. At the moment, the stocks are in my name & my ex-fiance's (she has agreed to be removed from the stock certificates), while the mortgages are solely under my name. This is pretty much the bulk of my assets - I have no substantial life insurance other than a $20k policy and no substantial savings

My health is not in the best conditions, and I've incurred about $25k of health-related credit card bills. I currently do not have a will. In the event my health takes a turn for the worst, I would like my brother to get ownership of the co-op without having to sell it.

My questions are:
- If I establish a living trust, with the co-op going to my brother, does this exempt the co-op from going through probate?
- Will he assume the mortgages when the trust is executed?
- Will it be better to have my brother on the stock certificate as a joint tenant survivorship (what my ex-fiance has)?
- If I pass the co-op to my brother, will he be required to sell it in order to settle my credit card debts?

TIA

[mfx]

Anyone?

[ScottGem]

If you transfer the stock to you and your brother as joint tenants with right of survivorship, then the coop passes to him outside the estate. The life insurance also goes to the beneficiary outside the estate.

Since the stock is being held as collateral for the mortgages, those would have to continue to be paid. However, any unsecured debt would have to be paid from whatever funds are in the estate, which you are saying is about nil.

The only issue would be that you would probably have to pay some tax for transferring half the property to your brother. Essentially you are gifting him about $80K.

[Fr_Chuck]

Not many of the stock co-ops around, since with the stock co-op you actually don't "own" the actual physical building but merely own the stock certificates giving you ownership in the over all building and also liablity of the entire building ( limited only by the certificate agreement)

I am not up on stock co-ops since none even exsist in my area, so this is going back to what I remember from real estate class. Ibeleive you will have to add him as owner of the certificates to keep it out of the estate and most likely have to have him added to the debts also.

Life insurance if it is named to a person, will also not go into probate.
Best advice, get a probate attorney to review it according to current probate law in your area ( it changes almost every year)

[ScottGem]

Just to clarify, when Chuck said add him to the debts he meant the mortgage loans, not other debts.

[mfx]

Thanks for the help

[Fr_Chuck]

Yes thanks scott.