Managing a trust can be challenging, especially when it involves real estate assets. In this episode of Absolute Trust Talk, host Kirsten Howe welcomes Karen Fisher, founder of Bishop Fiduciary Services, and Kathy Rodriguez, a licensed professional fiduciary and co-trustee with Bishop Fiduciary Services. Together, we will explore the complexities of life estates and trustee responsibilities and the essential steps for protecting and maintaining real estate assets, from securing insurance and handling maintenance to addressing unique challenges faced by elderly inhabitants. Karen and Kathy also highlight the critical differences between professional fiduciaries and family member trustees. Tune in to gain valuable insights and hear real-life examples that will help you manage these responsibilities with confidence.
Time-stamped Show Notes:
0:00 Introduction
1:18 Please join us in welcoming Karen Fisher and Kathy Rodriguez of Bishop Fiduciary Services!
3:20 To help get us started, Karen and Kathy define what a licensed professional fiduciary does and why they are unique to the estate planning and administrative world.
6:00 Why is it so crucial to evaluate the condition and value of property in a trust?
9:25 There are countless things to think about when you’re in charge of someone else’s real estate. Here are a few you might not have considered.
13:50 Estate planning can involve some tough conversations. Hear how Karen and Kathy handle these sensitive topics with senior homeowners.
15:50 As professional trustees, Karen and Kathy think about things that family-appointed trustees might overlook, like fire hazards or fall risks. Let’s dive into that.
16:35 What should a trustee do when they’re responsible for a home that’s empty?
19:10 Storytime! Listen to this wild tale about professional squatters moving in overnight.
20:30 Thanks so much to Karen and Kathy for their amazing insights. We can’t wait for Part 2 of this conversation
Transcript:
Hello and welcome to Absolute Trust Talk. This is our podcast here at Absolute Trust Counsel. I’m Kirsten Howe, and I’m very excited to have you here to listen to this episode. It’s really going to be fun and interesting, I think. We’ve had an episode or two recently where we talked about issues relating to real estate in estate planning and primarily focusing on the family home. It can be a challenging asset. Real estate can be a complex asset to plan with, depending on what the clients want.
Today, we’re going to talk about real estate and look at it from the perspective of administration—in other words, implementing the client’s estate plan with respect to their real estate. Two very experienced, knowledgeable, and just plain wonderful people are helping me out today. I’m going to introduce them now.
First is Karen Fisher. Karen is the founder of Bishop Fiduciary Services Limited. She founded it in 2013. To provide trust and estate services to individuals and families and a comprehensive suite of services that corporate trustees generally don’t offer. Many clients need additional services to continue living independently or fiduciary services to protect themselves from others. Karen can offer both and a lot more. Before forming Bishop Fiduciary Services, she worked in the trust and estate services world at several different financial institutions – City Bank, Bank of the West, and Mechanics Bank, where she was working when I first met her. She has an extensive range of experience in the trust and estates world, from ultra-high net worth to special needs trusts, and she can do it all. And I’ve seen her do it all.
Kathy Rodriguez is also a licensed professional fiduciary and currently acts as co-trustee with Karen. They are both with Bishop Fiduciary Services. Kathy works on many of the client accounts, including trusts and conservatorships. Kathy is also responsible for managing the fiduciary accounting schedule to ensure they meet all their court deadlines and all the accountings get filed on time. She has extensive experience in the mortgage industry and a Juris Doctor degree from John F. Kennedy University. She’s a lawyer. There, she worked in both the Elder Law Clinic and the Family Law Clinic, helping seniors with their estate planning. She has very pertinent, relevant experience to what she does right now.
Karen and Kathy, thank you so much for being here.
Thank you.
Thank you, Kirsten, for having us. I’m really excited to be here and share as much as we can with everybody. That’s great.
Thank you, Kirsten. It’s a pleasure to be here.
Before we get started, I think it might be helpful to our audience to remind people exactly what a licensed professional fiduciary is since you both are such and have a unique place in the estate planning and administration world.
Karen, do you want to go through the basics of what that means?
Sure. Thank you, Kirsten.
Many people I worked with in the trust world, trust, and estates of financial institutions, and I’m providing many of the same services as I did in financial institutions. However, you do not need to be licensed when you work under an institution. As soon as you go out on your own, whether creating an LLC or a corporation or working alone as a solo practitioner, once you have more than three cases, the state of California requires you to be licensed.
I was grandfathered in because I had so much experience that I could study for the exam and pass the exam to get my license.
Most people who come into this world probably don’t have the same level of experience and have to actually go to a trust school or fiduciary school, take courses, pass those courses, and then take the state exam. We’re licensed, and then you get your license, and then you renew it annually. All of the cases that we have are actually recorded at the state. The state oversees consumers to ensure we’re doing our job. And, of course, under the state of California, you have to follow many rules and regulations. And every year, we have to attest that we’re following those rules and obtaining continuing education credits in order to maintain our license.
You can serve as trustees for people, executors, and conservators. I think you can also serve as an agent under powers of attorney or healthcare director.
Yeah, we do frequently.
In fact, for many of our clients, especially elderly clients, I’ll be acting as, or Kathy and I will be working as, trustee, co-trustee, power of attorney for healthcare, or power of attorney for finances.
Thank you for that little synopsis.
As I said, we’re going to be talking about real estate, and what I want to first get into with you today is I think there are a lot of things about real estate, having real estate in a trust and being the trustee of that trust that our non-professional clients don’t quite know about or don’t quite appreciate. When you take responsibility for someone else’s real estate because you are a trustee, a lot goes along with that responsibility. Why don’t you start us down that path? For example, insurance is an easy, obvious one, so let’s talk about it.
Definitely, you know, real estate is one of the most significant assets that clients will have.
And as trustees, there are a lot of different duties. One of that is to protect the assets. That’s one of our main goals. One of our main concerns is we have to make sure that the property is fully insured and that the appropriate insurance is on the property.
Depending on where we’re at in the stress administration process, we may need to immediately change locks to secure the property, maintain it, and protect it because eventually, that property will either be sold or distributed to beneficiaries.
Kathy, you talked about maintenance related to insurance. And it’s not just maintenance, like making sure that broken things get fixed, and we’re especially talking about insurance, and we’re talking about the middle of the summer in California. I think we are. My mind, anyway, goes to fire, and we got to make sure the property is up to snuff concerning wildfire, right?
Absolutely, and depending on where the property is located, we’ll have to have our gardening landscapers go out there and trim what needs to be trimmed. If that requires tree trimming, the tree gets trimmed down or removed. We have to ensure that if the property is empty or is going to be empty for some time, it’s maintained weekly. We consider all those dangers that can possibly happen.
Do you typically get earthquake insurance on your properties?
We do. We do because we’re in California, and we know that it can happen. We do, and in addition to homeowners’ insurance and fire insurance, we get earthquake insurance as well.
That’s something that a lot of people don’t think about right there.
When you take over a property right out of the gate, what maintenance will you do? How will you figure out what you need to do?
I can go ahead and field that. That’s a really good question. When we take over real estate until we’re actually at home, we don’t really know what we’re – other types of properties, such as investment properties – we don’t know what we have until we actually do a walk-through and have an inspection.
We’re going to want to inspect the property, and we usually will have a property inspector come in, and what we’re looking for is, we do look for fire hazards. One of the things I did want to kind of tag team onto the last question is that the fire departments in the Bay area are very good to work with. They’ll come out and do an assessment and say, you’ve got to make a better fire – what’s called a defensible space between these, this shrubbery or trees in your home. And they’ll give you a list of things you need to do. It’s super helpful. We work with the fire departments quite often. When we have an inspection, we’re looking for fire hazards.
Sometimes, homes have not – the electrical has not been updated, and it looks dangerous. Maybe appliances aren’t working. There could be light fixtures that aren’t working or old carpet – I’ve walked into beautiful homes up in the hills where, for whatever reason, the owners have blocked many entrances and exits with furniture. And that is a potential disaster. If there’s a fire or another emergency and they can’t get out the front door, they won’t be able to get out.
We don’t know what we’re walking into until we’re actually in the home or property and do the walk-through.
Then, we get an assessment from the person who’s doing the valuation. These are the critical things that you need to get done. Unless you want to make changes or enhance the value of the property that you’re going to sell, you only need to do something if you want to enhance the value. These are the critical things. We will work on that. Then, we work on a regular maintenance schedule. It may just be having a gardener. If there are things that need to be monitored or repaired, we will ensure those get done on time.
One of the things that we have to ensure is the utilities. If someone has died, we need to get the utilities in the name of the trust or the estate. And if we’re working with a client who is living and needs our assistance, we’ll make sure that the utilities continue to be paid.
When you first walk in to do an inspection, it’s like, I think of what you do when you’re getting ready to sell your house, or you’re thinking about buying a house. For some, it’s a general inspection of the whole house, a professional, a contractor, who knows what they’re looking for. Correct.
For example, it doesn’t matter where the property is located. We want to get that home inspection done. For example, we have a client up in Washington. And the real property is up there. The beneficiary is still living in the property. We went ahead and ordered an inspection, a home inspection, to find out what urgent needs needed to be addressed for the safety of the beneficiary. And we make sure that those repairs are taken care of. The home inspection is really important, whether you’re selling the property or not.
When you have either a grantor or a beneficiary, a person actually living in a property that you are now responsible for, what other kind of things you mentioned – making sure that we don’t have furniture blocking exits – what other kind of things are you looking for, especially with an elderly inhabitant? Good question.
We want to ensure the home is safe and livable for that person. We’re looking for trip hazards. Sometimes, it’s old carpeting or uneven floor surfaces. Even when you’re walking out the back door, sometimes you go down the steps, and the sidewalk is uneven or there’s shrubbery overgrowth. And that’s preventing the senior, the client, from being able to walk out freely and safely.
The bathroom is another area. Sometimes, clients have upgraded and put in grab bars, so they’re able to walk right into a shower with maybe one step, or it’s just a roll-in if they’re in a wheelchair, which is wonderful because they know the importance of what they need to do to live safely and comfortably in their home.
Many times, homes are not upgraded, and I don’t know how people in their eighties and nineties do this; they’ve managed to climb into that tub. I can’t believe it, but we want to help make your life safer and more comfortable. We’re going to make those suggestions,
Obviously, if the client has capacity and wants to stay in their home, we’re going to encourage them to upgrade. Or if it looks like their home is going to be expensive to upgrade and they don’t have the funds, we want to have that talk very gently about moving into a safer place for them. Maybe you shouldn’t be living here. These are things that you need to take care of because, as the legal owner of this property, it is your responsibility to maintain it.
And if somebody gets injured, it’s on you. And I think a lot of our – I’m just going to call them family member trustees – don’t appreciate that. That is correct.
I was going to say that, too. That’s one of the differences between a licensed fiduciary and a family member. Not all family members, of course. There are some things that you think about. We already have that in our minds because we’re licensed fiduciaries held to a very high standard. Hence, we know that once there’s a real property involved, we’re thinking security, safety, you know.
We’ve been talking just recently about, we’ve got someone living in the home. Sometimes, you’re taking custody of a property where nobody’s living because the person who was living there has died. What are you looking for there? What are you concerned about there, and what do you do about those concerns?
That is a very good question. We have several homes right now that were in trust administration. A client has passed away. No one’s living there.
The first thing that we have done is to install an alarm system if there wasn’t one, or we take over that account or close that account if it’s ADT Bay Alarm or whichever company it is. We close that account and start a new account in the name of the trust, or maybe even has to be in Bishop fiduciary, depending on how they work their back office policies. We’re going to maintain the alarm system that’s there or get an alarm system. We do use cameras, and we download the apps and have them on our phones so we know what’s going on at the property.
Also, we might need to have the house on an alternate light-on-light-off schedule, so people believe that there is somebody there. Looks like somebody’s living there, yeah.
Most clients have cars, so if you keep the car in the front driveway, it looks like somebody’s there. And those are real concerns.
One of the things that I found out working with empty real estate is that the neighbors worry. They worry about the safety of the house, and they’re calling us on a regular basis to make sure that—oh, and one of the things I should say is that we need to make sure—and we do this weekly—we pick up the mail.
You want mail to be kept from piling up. Right. Or newspapers out on the front. Yeah. You’ve got to make sure it looks like somebody’s living there. Exactly.
Those are all the things we have to be very mindful of. Well, because the neighbors – I mean, I guess that’s a good practice – is you go out there and introduce yourself to the neighbors right away. “Here’s my phone number. If you see something, call me.” I think that the other things the neighbors don’t want are vandalism and squatters. They don’t want that in their neighborhood. Those are things that you have to worry about. Yeah.
Can I tell you a really quick story?
There was a home, this is really during the pandemic, right before everything got shut down in the pandemic and we were selling a home. We did not have that one alarmed because we were pretty close to, we were in contract, having it sold. And we had it on an alternate light schedule, we had new locks.
The neighbor called us and said, “I didn’t realize you sold the home already.” I’m like, “We have not sold the home.” Well, someone came in the middle of the night. And I don’t know how. They didn’t break in. They must have just gotten new locks. This is a very professional group.
We immediately went out there, and people had already moved in as if they were living there, and they tried to produce a false lease. Only because I was the trustee, I was on the title, and I was able to get the police to come out and have them removed right away.
It’s all about being hyper vigilant because if you’re not maintaining those properties, if you’re not paying attention, and you get someone to come in and is squatting, it could take forever to get them out.
Yeah. Then, you will have to get them out with a lawsuit, not just the police escorting them off. It has to be a long process in itself. Those are very, very good points.
Thank you, Karen and Kathy, for your informative talk here today. I learned a lot. My audience learned a lot, and I now have things to talk to my clients about. It’s wonderful.
Thank you, Kirsten.
You are very welcome.
Thank you all for joining us today. I hope you got a lot out of it, and we look forward to connecting with you again.
Get in Touch with Karen and Kathy!
Bishop Fiduciary Services, Ltd.
1399 Ygnacio Valley Road, Ste 25
Walnut Creek, CA 94598
(925) 954-7769
Karen Fisher, Founder: karen@bishopfiduciary.com
Katherine Rodriguez, Licensed Professional Fiduciary: katherine@bishopfiduciary.com
https://bishopfiduciary.com/
Resources Related to This Episode:
- Absolute Trust Talk Episode 140: Navigating Trust Complexities: The Family Home Dilemma: https://absolutetrustcounsel.com/140-navigating-trust-complexities-the-family-home-dilemma/
- Absolute Trust Talk Episode 090: Choosing a Trustee – How to Get It Right: https://absolutetrustcounsel.com/090-choosing-a-trustee-how-to-get-it-right/
- Absolute Trust Talk Episode 070: Trustee Do’s and Don’ts Part Two: https://absolutetrustcounsel.com/070-trustee-dos-and-donts-part-two/
- Absolute Trust Talk Episode 044: Estate Administration: Executor & Trustee Dos & Don’ts: https://absolutetrustcounsel.com/044-estate-administration-executor-trustee-dos-donts/
- A Will is Not Enough – Securing Your Legacy with Estate Planning Life can change in an instant. A will is not enough to be prepared. Get free access to our actionable E-book Guidebook #1 and start protecting your legacy today. https://absolutetrustcounsel.com/guidebooks/
- Learn how to comfortably define gray areas and assess your own unique needs to effortlessly build a secure future now. Check out Guidebook #2, Estate Planning Beyond the Basics, here > https://absolutetrustcounsel.com/guidebooks/
- Get our free introductory guide to the most used estate planning tool, family trusts, and understand how we plan to help protect your family. Guidebook #3: https://absolutetrustcounsel.com/guidebooks/
- Absolute Trust Counsel would love to offer access to our Incapacity Planning resource page: https://AbsoluteTrustCounsel.com/Incapacity-Planning/. We’ve collected our top planning information all in one place so listeners can find videos, guidebooks, blog posts, and a host of information with tips and strategies on implementing, planning, and protecting themselves and their loved ones.
- We’re pleased to provide a library of e-books to address common estate planning questions and concerns in practical, easy-to-understand language. https://AbsoluteTrustCounsel.com/Resources/.
- ASK KIRSTEN: If you’d like Kirsten to answer your question on the air, please email her at Info@AbsoluteTrustCounsel.com.
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