It’s common when both parents die, that they leave their home to their children. However, what happens when the sibling, who’s the executor or trustee, refuses to sell the home (which still has a home equity loan).
nj.com’s recent article, “What happens when siblings can’t agree about selling parents’ home” explains that even though an executor has some discretion in administering the estate, she has a duty to settle and distribute the estate expeditiously and efficiently for the best interest of the beneficiaries.
Unless the parent’s will or trust has specific instructions for the home, the executor or trustee—at his/her discretion—has two choices: Sell it and distribute the net proceeds, or distribute the home “in kind” to the beneficiaries. That means retitling a deed from the estate or trust to the beneficiaries as tenants in common. If the property is distributed in kind, the beneficiaries will then own the property jointly and will be jointly obligated on the home equity loan.
Creditors have a specific time period in which to present a claim to the executor or trustee. As a result, many executors won’t make distributions before that time has concluded.
If an estate or trust has been lingering open for a very long period of time after a death has occurred, and family members think that the executor or trustee isn’t fulfilling his/her obligations, they may sue to have the person discharged and a new one appointed. The court may discharge an executor or trustee for not obeying a court order, like filing an accounting or an inventory of estate assets. The executor or trustee may also be removed if, for example, the person is found to have committed embezzlement, waste, misappropriation, is incapacitated, or neglects or refuses to perform the required duties of the office. Beneficiaries can also ask the court to direct the executor or trustee to perform a particular action.
Reference: nj.com (October 4, 2018) “What happens when siblings can’t agree about selling parents’ home”