Q: My parents are planning on giving their home to one of my siblings. The home's value makes up half of the estate.
They really want her to have the home, but at the same time, keep things equitable with the other 3 kids. Is there any way to do this?
A: Yes, if your parents want to keep the division equitable, they should consult an estate planning attorney. If they try a DIY plan like adding your sister's name onto the deed now or put it on a transfer on death deed, not only would the house would go directly to your sister but there are other very important consequences that they should be aware of. But if your parents left the house to you and your siblings through an estate plan, there are "trust loans" that a few California lenders do which could create an equitable division. The lender evaluates the property and the sibling who keeps the house will get a trust loan that allows the other siblings to obtain cash instead of ownership to the house. This should be done with a lender who understands Prop 58 and how to avoid reassessment in order to preserve your parent's Prop 13 tax base so that your sister's property taxes are not increased.
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