Q: I am residuary beneficiary in my dad's estate. Trustee is joint on 1 property and beneficiary on another.
Both of those properties have existing mortgages. Is the trustee allowed to pay off the mortgage with estate money? I am worried that money that would come to me as the residuary will be used up to pay off these mortgages so that she inherits property free and clear and there is less money left to come to me. Can the estate lawyer/trustee use estate funds to pay off mortgages?
A: This depends upon the instructions given to the Trustee in the Trust. It may be appropriate. If the Trust is unclear or if you believe that the Trustee is acting improperly, an action can be filed with the Court to address these issues. Where a Trustee is abusing his/her authority, the Trustee can be removed by the Court and a new Trustee appointed. I recommend that you review the facts of this matter with an Attorney. Once your attorney has reviewed the trust document and learned all of the facts, he or she will be able to let you know your legal rights and best options.
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