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I own a condo and I want to leave it with my daughter when I die. How can I be sure that he can maintain it?


Dear Marketwatch,

I’m not planning to pass any time soon; However, I am at an age where my finances need to be adjusted.

I have only one child. The only real asset I have is my condo, which I still have mortgaged. I am curious about what will happen to my condom after my death because it relates to my daughter.

My daughter has no legal obligation regarding my condo. He is not a co-owner, or he is in a deed, mortgage, etc. My concern is that my daughter will have no financial means if my condo is sold, if I die.

What exactly do I need to do to make sure he can sell condos and secure income? Can one save him? Should I mortgage his name?

If I sell my condo today or tomorrow, considering the upgrades I’ve made as well as the location of the condo, I’m positive that I can net between $ 70,000 and $ 80,000 net income. The property is in Illinois, and I was able to buy the property in 2009 at a very low market price with a 30 year mortgage.

Will my daughter be able to sell condos? What do I have to do to make sure he can sell? I don’t want my daughter to be left out in the cold and my bank to confiscate or forfeit my property.

Absolute respect,

Condo mother

‘The Big Move’ is a marketwatch column on the ins and outs of real estate, from navigating the search for a new home to applying for a mortgage.

Do you have a question about buying or selling a home? Do you want to know where your next step should be? Email Jacob Passy at TheBigMove@marketwatch.com.

Dear mother

Your concerns are more than legitimate. When we draft wills and think about the money left to our loved ones at the time of death, I think most of us imagine our heirs that those windfalls make full use of them. But the reality is quite different. The study found that one in three Americans inherited it.

Of course, in many cases, those people probably lack the discipline to save money and spend it. Yet, of course, there are situations where the person who inherited it was not equipped to use it properly. I received emails from readers who inherited homes, but I did not know of a mortgage or tax loan that ultimately led to the recovery of the property. No parent wants to waste their homemade eggs.

So it’s good that you’re asking these questions now. For starters, if you haven’t already done so, you should consult an attorney who specializes in estate planning, the best way you can give your daughter a condo after she dies. Many people like the idea of ​​creating trust, because it can bypass the probate process and the house can quickly fall into the hands of their heirs. This can be useful for your daughter because the sooner she has the right to the property, the sooner she will be able to sell it. This will help reduce the cost of mortgage payments, maintenance, condo fees and taxes.

At the very least, your will should state that you want him to inherit the house, but keep in mind that your state law and the draft will may have to go through a probate process depending on the way the will was made. It can take time – and it can cost money.

I would not recommend adding a mortgage or deed to him. As I mentioned earlier, doing this before you die means that he will not receive full tax benefits if he only inherits. Also, if your daughter has an outstanding debt, those lenders may come after your property to repay the loan. Most importantly though, it won’t save him from the burden of having to bear the costs associated with the condo before offloading.

Here are a few more steps you can take now to make sure he or she is well prepared for future costs and responsibilities. Nadine Marie Burns, a certified financial planner and president of A New Path Financial, recommends providing details of all costs associated with Condo for one year – from tax and mortgage payments to association fees and utilities. After that, you need to talk to your daughter, she advised, so she is well informed.

“It can be a positive conversation, and very few people have it,” Burns said. By now you assume that your daughter will not be able to manage these expenses, but you may not get a complete idea about her finances. If she’s worried about being able to carry those payments until she sells condos, you may want to start saving some cash for your daughter that she can use to cover those payments.

You can give money to your daughter over time and make sure she saves it. Another option, Burns said, is to open a life insurance policy and keep your daughter’s name as the beneficiary. The size of the policy can be designed to cover the one year cost of condo costs and any incidental costs related to its sale.

Finally, you should familiarize yourself and your daughter with your condor sales policy. Some associations withhold the right of first refusal and will purchase property directly from the seller if the buyer does not approve. Knowing these principles and your daughter’s rights can save her from a lot of headaches down the street if the condo approves the new resident and pulls her legs.

I know this conversation can be uncomfortable. It can be awkward for someone to be on your death row and be so open about your finances. But when it comes to your daughter managing your property, I am sure she will be grateful for your transparency. Good luck as you navigate this decision.

By emailing your questions, you agree to publish them anonymously on MarketWatch. By submitting your story to Dow Jones & Company, the publisher of MarketWatch, you understand and agree that we may use your story or its versions in all media and platforms, including through third parties..



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