Are you a personal representative of an estate subject to creditors? In a recent case out of the Fourth District Court of Appeal two banks claimed entitlement to a promissory note held on a property. The court was tasked with deciding who gets paid. As a personal representative do you know whom to pay?
Inheriting a Mortgage
- If you inherit property subject to a mortgage, you also inherit the mortgage.
- You can choose to liquidate the property, pay off the mortgage and take some money for yourself but most choose to assume the mortgage.
- So what happens in a situation like the one above where you have two banks both claiming they want to get paid?
- What would you do?
- Experienced Palm Beach probate litigators know that creditors come hard when an estate is open, they sense it’s their last time to get paid.
- Are you prepared to get relief from creditors that the estate is entitled to?
HSBC Bank USA v. Perez et. Al.
- As a result of a fraudulent scheme, two banks took possession of nearly identicalpromissory notes secured by the same mortgage. The underlying transaction contemplated just one note. After payments stopped, both banks sought to foreclose on their notes. The question before the court was which bank was entitled to proceed on a foreclosure.
- You can imagine how complicated this would be if the mortgagees were dead!
- The court had to decide which body of law to use, the mortgage assignment statutes or the Uniform Commercial Code but the issue remains the same no matter what as a personal representative – who gets paid!?
- Are you experiencing creditor confusion?
- You may be personally liable for unpaid creditors so watch out.
Want to learn more check out the entire case? Click here.