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    lostnalabama's Avatar
    lostnalabama Posts: 2, Reputation: 1
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    #1

    Sep 30, 2011, 02:06 PM
    Does a Warranty Deed circumvent paying credit card debts after death of the Grantor
    My father had a warranty deed filed giving me his house and its' contents upon his death. But, he has considerable credit card debts. Will I be responsible for those debts, i.e... have to sell the house to pay them or will the house and any lien against it be mine?
    He thinks the warranty deed will remove me from being encumbered by those debts.There is no insurance or savings, no monies upon his death. You help would be greatly appreciated Father.
    tickle's Avatar
    tickle Posts: 23,796, Reputation: 2674
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    #2

    Sep 30, 2011, 02:35 PM
    A warranty deed only states that the holder has clear title to a property.
    No it won't remove you from being encumbered by debt should there be any attached to the estate once your father passes.

    Tick
    twinkiedooter's Avatar
    twinkiedooter Posts: 12,172, Reputation: 1054
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    #3

    Sep 30, 2011, 02:37 PM
    The liens stay with the house and property until satisfied. You won't be responsible for his debts but if there are any liens on the property, then they must be satisified if you try to sell the property to someone else.
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    ScottGem Posts: 64,966, Reputation: 6056
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    #4

    Sep 30, 2011, 02:42 PM
    The wording of this deed is important. If he holds ownership of the property until death, then the property will become part of his estate and his debts will need to be paid from the estate. However, if he has deeded the property to you and him as Joint Tenants with right of Survivorship, then you are a part owner of the property and the property passes to you outside the estate.

    If he did transfer the property to you and him, then there may be tax implications. To deal with.

    I would suggest your father consult an estate attorney for the correct way to protect the property.
    AK lawyer's Avatar
    AK lawyer Posts: 12,592, Reputation: 977
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    #5

    Sep 30, 2011, 03:17 PM
    Quote Originally Posted by lostnalabama View Post
    My father had a warranty deed filed giving me his house and its' contents upon his death. But, he has considerable credit card debts. Will I be responsible for those debts, ie...have to sell the house to pay them or will the house and any lien against it be mine?
    He thinks the warranty deed will remove me from being encumbered by those debts.There is no insurance or savings, no monies upon his death. You help would be greatly appreciated Father.
    Has a judgment been entered against your father? Typically, the recording of such a judgment would be how a lien would be created. If a judgment was recorded before the date of the deed, judgment creditors would be able to enforce that judgment by executing against the house and contents.

    He received nothing of value in exchange for this? If not, the transaction could in theory be set aside as being a fraud on creditors. I don't see this a being likely to happen, but diligent creditors could in theory seek such a remedy.
    lostnalabama's Avatar
    lostnalabama Posts: 2, Reputation: 1
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    #6

    Oct 2, 2011, 02:40 PM
    The property does have a small lien, which I am prepared to payoff at his passing. My greatest concern is whether the credit card bills would have to be paid, meaning would the house have to be sold even though he has signed it to me by warranty deed.
    tickle's Avatar
    tickle Posts: 23,796, Reputation: 2674
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    #7

    Oct 2, 2011, 03:08 PM
    Quote Originally Posted by lostnalabama View Post
    The property does have a small lien, which I am prepared to payoff at his passing. My greatest concern is whether the credit card bills would have to be paid, meaning would the house have to be sold even though he has signed it to me by warranty deed.
    The debts don't pass with your father, sorry to say. Yes, the credit card bills will have to be paid out of the estate unless you want to be hounded forever for payment. Surely the credit card debt is not so big the house will have to be sold?

    Tick
    ScottGem's Avatar
    ScottGem Posts: 64,966, Reputation: 6056
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    #8

    Oct 2, 2011, 04:20 PM
    Quote Originally Posted by lostnalabama View Post
    My greatest concern is whether the credit card bills would have to be paid, meaning would the house have to be sold even though he has signed it to me by warranty deed.
    Please reread what I said. His debts will have to be paid from the estate. If the estate's only asset is the house then it will have to be sold to pay the debts unless you want to pay them out of pocket to preserve the house. If the house can be passed to you outside the estate, then you can keep it.

    So the key here is how the deed is worded and when its executed.

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