April 12, 2023
Needham, MA--Although many real estate transactions take a fairly standard and predictable course, there are often profound issues that can complicate the transfer of property. We see one of those issues fairly often in the form of a home owner’s adult children attempting to sell the home owned by their mother or father when that parent has become incapacitated by dementia.
To be successful in this process, it is always advisable to enlist the aid of an attorney to ensure that all the i’s are dotted and the t’s crossed.
Here is what needs to be considered when selling property on behalf of a parent who has become incapacitated.
Power of Attorney
The first step in managing the sale of property for a parent is to secure a power of attorney as parents begin to age. However, not all powers of attorney are created equal. It’s imperative that your clients meet with an attorney to ensure the broadest rights are included in the power of attorney to cover future eventualities.
Experienced legal counsel can advise your clients and their parents on the appropriate powers of attorney to secure depending on the age of the parents, their current situation and the expectations they have for your client managing their affairs in the future.
Remembering that each state has its own rules when it comes to the different types of POAs and their efficacy, here is a brief look at what each power of attorney type generally offers.
General Power of Attorney
A general power of attorney gives your clients the broadest control over their parents’ financial affairs, allowing then to manage accounts, sell property and enter into contracts on their behalf. This POA may expire if the parent becomes incapacitated unless it is created as a durable power of attorney.
Durable Power of Attorney
A durable power of attorney (DPOA) allows your clients to make decisions on behalf of their parents if they become incapacitated, giving them authority to make health and financial decisions and to sign documents.
Medical Power of Attorney
A medical power of attorney allows your client to make medical decisions for their parents if they are unable to make those decisions for themselves.
Limited Power of Attorney
A limited power of attorney, sometimes called a special power of attorney, can be created for the sole purpose of selling the parents’ property. It is very specific and expires after the named task has been completed.
Springing Power of Attorney
A springing power of attorney, sometimes called a conditional power of attorney, specifies an event or situation that triggers your client’s ability to invoke the power of attorney, such as incapacitation.
Guardianship
If a POA is not in place, your client can seek guardianship over their parents in the case of incapacitation but be aware this could be a very time consuming process and could seriously delay their ability to sell property.
If clients find themselves in a situation where they must sell their parents’ home for any reason, encourage them to contact an experienced real estate attorney to review any current POAs in force to ensure they have the necessary documentation in place to legally handle the sale for their parents before they become embroiled in the transaction.
At Kriss Law/Atlantic Closing & Escrow, we have available a full range of experienced legal expertise to assist your clients with the most complex details of their real estate transactions.
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