How a $32 Life Insurance Policy Protected a $475K Mortgage
- By Jim Blackburn
- on
Client Profile:
- Names: Michelle & Darren
- Ages: 58 & 61
- Occupations: Retired teacher and small business owner
- Goal: Make sure their rental properties passed to their kids without legal delays
- Location: Sacramento, CA
The Situation
Michelle and Darren owned 3 properties:
- Their primary residence
- A duplex rental
- A paid-off condo in Arizona
They had wills but hadn’t taken the time to create a living trust. After hearing a friend’s horror story of losing a property to probate complications, they contacted us for help.
We walked them through what would happen if one of them passed unexpectedly without a trust — and it was a wake-up call.
The Risk Without a Trust
Without a living trust:
- Each property would go through probate (which can take 9–18 months)
- Their children would need to hire attorneys and petition the court
- Their rental income could be frozen during the process
- Assets could be subject to unnecessary taxes, delays, and disputes
They realized they’d built wealth… but hadn’t protected it.
The Strategy
With an estate attorney, we helped them:
- Create a revocable living trust
- Title all three properties into the trust
- Name each other as successor trustee, then their daughter
- Include instructions for selling, renting, or gifting each property
- Add durable power of attorney and medical directives
The Results
- Peace of mind knowing everything is in order
- Rental income would continue uninterrupted
- No probate required for any real estate
- Their kids will inherit directly, with no courts involved
- Updated their life insurance and 401(k) beneficiaries to align with trust
What Michelle Said
“We thought a will was enough. But this trust guarantees our kids won’t have to deal with red tape and confusion during an already hard time. That’s priceless.”
Takeaway for Readers
If you own real estate — especially rentals — a living trust isn’t a luxury. It’s a necessity. It’s the difference between your family inheriting a gift… or a mess.
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