You were given a life estate,
a life estate is when you retain ownership rights only after the original owner passes away,
Yes, but I am listed on the deed.
You can be listed on the deed through a life estate deed,
in terms of a bankruptcy this will cause a problem for you.
the Life Estate is an asset, and worth money,
you would have to exempt the life estate amount in order to keep it.
How does my father go about doing that?
Does he need to remove my name from the deed completely?
It would be best to remove your name from the deed, unless you can exempt it, in NY you can exempt a significant amount of equity in a home from bankruptcy,
If you are living in the home, you could use the NY Homestead exemption,
Under the New York exemption system, the homestead exemption amount varies depending on the county in which the property is situated.
The exemption covers your interest in a house, a condo, a co-op, or a mobile home.
No, I'm not living in the home. I live in a house that will be going into foreclosure soon so I want to protect my father's home.
Then the life estate would have to be removed,
and it would have to be valued,
it actually can be sold if you file bankruptcy not the home but your future interest in it.
We have no plans on selling my father's home. I guess I would need to be taken off of the deed. If we do it now, before I file for bankruptcy is that considered to be fraud?
it will be an issue, however since the property is still in your fathers name,
he can change the deed, and put it into a trust, which would be better,
a spendthrift trust would protect the home from a bankruptcy filing by yourself
So they can't touch my father's house if it's put into a trust?
a spendthrift trust is best
ok, what type of lawyer would I need to see in order to have this done?
A good trust lawyer would need to be hired to do this. The law states that a trust becomes property of the bankruptcy estate, unless the trust contains a spendthrift clause enforceable under state law. If so, section 541(c)(2) of the bankruptcy law excludes the trust from the bankruptcy estate, and therefore it is protected. This means your bankruptcy lawyer will need to carefully examine the terms of the trust to see whether it contains a spendthrift clause.
Any real estate or trust attorney could handle this.
If you have any further questions please do not hesitate to ask.
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Thank you very much. You have been very helpful.
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