Be Wary of "Pay On Death" Provisions in Your Estate Plan
You’ve got Brian, Jim and John, your three sons, and you want to make it easy for them to get your assets after you pass away. After you pass away, and if you make Brian, Jim and John the co-owners of the house, that is in almost every situation I’ve ever seen becomes a disaster scenario for those three sons.
Suppose Brian no longer wants to pay for his share of the house mortgage, or Jim says, “I’m not going to pay for the property taxes. I don’t got that kind of money to do that.” John says, “Well, I want to rent the house out and I want to get some rental income.” The other two are like, “Well, I don’t want to be landlords for some period of time.”
It’s a disaster waiting to happen because all three of them essentially have to agree on how they’re going to hold the property, how they’re going to use the property, who’s going to pay the expenses, when are we going to sell, how much are we going to sell for.
It’s a very, very difficult situation to put people in to be able to be on same page with that.