Equity Loans within Trusts
I am the Trustee of my late Mother’s Trust. The Trust owns a condominium. I may need to access the equity in the condominium in the future to help with expenses for my sister, who is the beneficary of the Trust. Is it better to access the equity by means of a Home Equity Loan, or by a Home Equity Line of Credit? Thank you in advance for your wisdom!
Terry Says
I think you should start now by inquiring about a home equity line of credit. That may be difficult, because you’ll have to prove you’re the successor trustee, and depending on your sister’s age and health, it could be difficult to force repayment (unlike with seniors, who presumably will die relatively soon so any borrowings can be repaid out of the equity). If you have difficulty getting a loan, your only recourse may be selling the condo and using the proceeds for her care.
Here is some info about home equity lines of credit for seniors — but again, depending on your sister’s age, that may not apply.
https://www.ncoa.org/article/what-is-a-home-equity-line-of-credit-heloc-a-guide-for-older-adults/
