Ask Thomas Mitchell: Is My Trust from Another State Valid in Florida?
Summary
I’m Thomas Mitchell, partner at Waller & Mitchell in New Port Richey Florida, and I do estate and trust work. Sometimes people ask me, “Is the trust that I had drafted for me in Ohio or Pennsylvania still valid here in Florida?” The short answer is yes, it is still valid here in Florida. The US Constitution has a provision in it that says states must honor the laws of other states. It’s called the Full Faith in Credit Clause, and so if your trust was valid in the state in which it was drafted, then it will be valid here in Florida.
Having said that, however, there are a couple of reasons why you might want to think about having it redrafted or amended once you get here to Florida. The first is that if there happens to be any problem with the trust, if there’s a contest to it, if someone thinks you weren’t competent when you executed the trust or that you were somehow influenced to make the trust against the person who’s challenging, then all the witnesses who were there for the execution of the trust are gonna be located in Ohio or Pennsylvania or wherever it was you lived before. So that’s the first thing.
The second thing is you should take a look at your estate planning documents any time you have a substantial change in your life situation, and for me, moving to Florida certainly qualified as a life changing situation. And so when that happens, you want to take a look at your estate planning documents: your will, your trust, powers of attorney, all those things. And lastly, all the trusts that I’ve seen have in it what’s called a choice of laws clause. What that says is this trust is to be administered pursuant to the laws of the state of Florida, or if you were in Pennsylvania when it was drafted, typically it will say the state of Pennsylvania because the lawyer that drafted it was a Pennsylvania lawyer and he knew Pennsylvania law.
Well, now that you’re living in Florida, we don’t want to administer the trust according to Pennsylvania law because very few of us down here are going to know what that is, so that means that we’d have to associate an attorney in Pennsylvania to advise us on what the law says. So typically when you move down here, at the very least you ought to have your trust amended so that the choice of law provision is changed to say we’re going to administer this trust pursuant to Florida law. We’re located at 5332 Main Street in New Port Richey. Our telephone number is 727-847-2288. Thanks.
Ask Thomas Mitchell: If I Go Into a Nursing Home, Can The Nursing Home Take My House?
Summary
I’m Tom Mitchell, a partner with Waller & Mitchell, and I do elder law here. One of the things that I do is planning for individuals who might have to go into a nursing home and need to ensure that their assets are not completely dissipated. I frequently am asked, “Is the nursing home going to take my house when I go?” And the answer is no.
First, under Florida law there is a provision called the Florida Homestead Provision. And that’s not the homestead that you have on your real estate taxes, but this is a provision of the Florida Constitution that says your house, the house that you reside in before you went into the nursing home, is your homestead and is exempt from forced sale by your creditors. Which means that the nursing home cannot force you to sell it in order to pay the bills. And after your death, if it’s willed to your heirs, your blood relatives, or children for example, it continues to have that exemption from creditors’ claims.
So whether you’re married or single, you can have the house. If you’re single, you can only have $2,000.00 in the bank. That’s all you can have, and all the rest of your assets have to be dissipated, spent on the nursing home in order to pay for your care. Now, there are some other planning opportunities that I can do for you if you need to have that done, so give me a call if that’s the situation.
But in a married situation, the spouse who’s staying at home gets to keep additional liquid assets so that they are not impoverished. Currently the liquid asset amount is about $115,000.00 of liquid assets. That’s stocks, bonds, mutual funds, and cash in the bank. This does not include the house or car and does not include the usual household effects: the toaster, blender or the big screen TV.
So in a nutshell, the nursing home is not going to take your house. If you have any questions, please call me at Waller & Mitchell. We’re located at 5332 Main Street in New Port Richey. My telephone number is 727-847-2288. Thanks.
- Published in Medicaid Planning, Videos
If My House is in Foreclosure, Can the Lender Take Money from My Bank Account?
Video Summary
If my home is in foreclosure, can the bank take money from my bank account?
Well, the bank cannot, unless you bank with the same lending institution where you have your mortgage. So if you have a bank account with Bank of America, and you also have your mortgage or line of credit with Bank of America and you go in default, they may exercise the right of offset to take money out of your account.
If, however, you have your mortgage with Bank of America, and you have your bank account with any other financial institution, Bank of America has no right to attach any of your assets or your bank account whenever you go into foreclosure.
A foreclosure action is one wherein the lender is taking back their collateral, which is called a foreclosure. They are not suing for a money judgment.
In order for them to obtain a money judgment, they must file a supplemental proceeding after the foreclosure action. That’s called a “deficiency judgment action.” And then, if they do obtain a deficiency judgment, they’re then in position to garnish your bank account, or take your bank account or any other assets other than your home or other assets that you may own as husband and wife.
So the answer to the question is: No, the bank cannot take your money or your assets just because they file a mortgage foreclosure action unless you’re banking with them and they may have some right of offset.
If you’d like to talk to me or set up an appointment to discuss foreclosure action, please call me at (727) 847-2288, and I look forward to seeing you.
- Published in Real Estate - Foreclosure, Videos
If My Home is in Foreclosure, Can the Lender Lock Me Out of My Home?
Video Summary
If my home is in foreclosure, can the lender lock me out of my home?
The answer to that question is: No. Once they file the mortgage foreclosure action, they have to conclude it and get what they call a “certificate of title” showing that they’re the owner before they’re entitled to possession. Even after getting the certificate of title, they must apply to the court for what they call a “writ of possession” before they are entitled to have you removed from the property and take possession of the property.
If the property is abandoned – meaning that there’s no one living there – the lender does have a right under most mortgages to secure the property. And they hire contractors to go out and change the locks and to maintain the property, cut the grass and basically make the property look like it’s not abandoned.
We’ve seen any number of abuses and very aggressive contractors going out and changing locks even though someone may be maintaining the property. However, if you’re living there, I can assure you that they will not come on the property to change the lock. Or if they do, simply call the police, 911, and have them arrested for breaking and entering if they attempt to change the locks on your house.
If you go away on vacation and come back and see they’ve changed the locks, all you have to do is break in and take their locks off because it’s still your property. So you’re not divested of that property until such time as the mortgage foreclosure has been completed. They get a certificate of title and then they have the occupant – whether it be a tenant or you if you’re living there – obtain a writ of possession. If you have tenants there, the tenants have the right to remain in the property for the balance of their term under a federal law that allows tenants to remain in possession even after the mortgage foreclosure.
If you have any questions about your mortgage foreclosure or would like representation, give me a call at (727) 847-2288.
- Published in Real Estate - Foreclosure, Videos
If My Home is in Foreclosure, Can I Buy Another House?
Video Summary
If my home is in foreclosure, can I buy another house?
The answer to that question is: You certainly can. The only impediment you may have is if you go to a federally insured lending institution and apply for a loan. If your home is foreclosed, then after the foreclosure you may be prevented – or you won’t be able to borrow money from a federally insured financial institution for a period of four years.
During the foreclosure action or even after the foreclosure actions, you can buy a home any time you want to. You can of course pay for it in cash, if you have the cash, and then move into the home and it’s protected as far as your homestead is concerned. You can see about owner financing to give some money down and have the owner carry the mortgage, or any other way that you can find to purchase a house.
So there’s no prohibition about buying a house. Some people find themselves with a mortgage that far exceeds the market value of the property. They have good credit and decide that they’re going to give up on that property. They have money, they have credit, and they go out and buy another house and finance that, and then short sell or let the original home that is underwater go. This is called “buy and dump,” and basically there is no problem in buying. And it’s something that does happen.
So yes, you can buy a house as long as you can figure out how to pay for it, either through cash or owner financing.
If you’d like to discuss this with me, give me a call at (727) 847-2288.
- Published in Real Estate - Foreclosure, Videos