Land Contract A friend of mine has legal authority to sell her client’s home to…

Posted on by

Land Contract
A friend of mine has legal authority to sell her client’s home to raise money for her care and funeral expenses. She is considering selling the propery, which is paid for, on a land contract. When collecting the mortgage payments from the new owners do I need to put the money in an escrow account or will her checking account be sufficient? Also, upon her death do the beneficiaries of her home receive that money or does it go into her estate?

2 thoughts on “Land Contract A friend of mine has legal authority to sell her client’s home to…”

  1. Re: Land Contract
    What sort of legal authority? Is the person the conservator for the other person? I’m unsure of the relationship. If the person is a court appointed conservator, they probably need the court’s permission to sell the property. Does the person have a court order approving the sale? A land contract is generally not the best way to dispose of assets in these types of situations. Cash is usually better as it can be readily used for the persons care. For more info, please contact my office at (248)851-3171.

    Blake Lipman
    Law Office of Blake P. Lipman
    31275 Northwestern Hwy. Suite 140
    Farmington Hills, MI 48334

  2. Re: Land Contract
    Why sell on a land contract? Usually property is sold on a land contract when interest rates are very high (not the case in today’s economy) or the purchasers do not have credit good enough to qualify for a mortgage. Your friend should understand that she probably has a fiduciary duty to this person, which is a heightened obligation to act in her best interests and which should be taken very seriously. If for some reason a family member (“beneficiary”) is unhappy with the results/decisions your friend makes and sues your friend for breach of fiduciary duty or something else relating to this decision, a court could find your friend personally responsible to the family members for any financial loss. Your friend needs to be very careful that she is selling the property for good value in an arms length transaction (not giving a friend or family member a “deal”). There should probably be a bank account set up for the benefit of the elderly person. Your friend should consult an estate planning attorney to protect both herself and the person on whose behalf she is contemplating acting.

    Rochelle Guznack
    Law Offices of Rochelle E. Guznack, PLLC
    16325 Homer
    Plymouth, MI 48170

Comments are closed.