Yesterday I got a deal under contract from the leads Ellis gave us during Summer School. Goes to show how persistent you need to be on the follow up and working of these deals. Been working this one for 4-5 months now and now it’s under contract. Cool little win from Summer School after the fact. @Ellis San Jose

Situation: Ran into something a bit unusal the other day; some extensive construction work was done on a property by a contractor (a BRAND new poolhouse was built with a full outdoor kitchen, a large inground pool was installed, and a seperate large carport structure were all bulit by this contractor vendor). The contract was never fully paid so the property owner entered into a Mechanics Lien Contract for $200K. It apparently was never fully paid or was partially paid over time and the property owner and contractor vendor agreed to convert the Mechanics Lien Contract into a more customary Promissory Note secured by a 1st lien position DOT -Deed of Trust. Problem / Concerns: That Note has been paid on as agreed now for some time. There also appears to be enough adequate equity protection of the properties value Vs the amount of Debt still outstanding on the DOT and Note. The Contractor now wishes to raise funds thru the Sale / Liquidation of the DOT & Note. Assume that a loan title insurance policy can be obtainted to insure the priority 1st lien position of the DOT, however any thoughts on other minefields to be aware of here?

A Little Fun Tidbit about Estates and the estate of Howard Hughes who passed without a valid Will When Howard Hughes died without a will, over 400 people claimed his $2.5 billion empire. One was a gas station attendant who demanded $156 million for rescuing him in the desert. The chaotic probate battle began shortly after Hughes died aboard an airplane en route to Houston in 1976. Because the reclusive billionaire had kept his affairs notoriously secretive, his lack of verified instructions left the door open for hundreds of claimants. These included women asserting they were secretly married to him and a legion of alleged illegitimate children. The most infamous claim—the one involving the gas station attendant—came via the "Mormon Will," a handwritten document discovered on a desk at the headquarters of the Church of Jesus Christ of Latter-day Saints in Salt Lake City. The will left large chunks of the estate to charities, Hughes’s ex-wives, and church organizations. It also allocated one-sixteenth of the fortune to Melvin Dummar, the attendant who claimed to have picked up a disheveled Hughes in 1967 and given him a ride to Las Vegas. After a sensational seven-month trial in 1978, a Nevada jury ruled the document a forgery. Once the fake wills and spurious claims were dismissed, the courts determined that Hughes had died intestate. Under the law, his estate passed to his closest living relatives: 22 cousins on his mother's and father's sides of the family. The most prominent of these heirs was William Lummis, a Texas attorney who had not seen his famous cousin in 40 years. Lummis took over the administration of the estate, which was entirely tied up in Summa Corporation, the holding company for Hughes’s casinos, hotels, vast tracts of Nevada real estate, and aviation interests. Lummis spent over a decade systematically unwinding and liquidating Summa Corporation to distribute the cash. While the cousins did eventually receive their inheritances, the final payouts were heavily diluted from the original valuation. The estate faced immense inheritance taxes from the federal government, and the sprawling legal battles consumed tens of millions in attorneys' fees. By the time the estate was finally settled, the remaining money had been quietly dispersed among the large pool of distant relatives.

Medi-Cal Estate Recovery: The “Homestead of Modest Value” Waiver California law gives heirs a way out of a Medi-Cal estate recovery claim when the family home is worth relatively little. The rule comes from Welfare & Institutions Code § 14009.5, added by SB 33 in 2015. California Advocates for Nursing Home Reform sponsored the bill. Under § 14009.5, DHCS must consider whether recovery would cause substantial hardship. If the estate is a “homestead of modest value,” DHCS is required to waive its claim, subject to federal approval. The statute defines a homestead of modest value as a home whose fair market value is 50% or less of the average home price in the county, measured as of the date of death. DHCS also has to tell heirs about the waiver and their right to a hearing, and must include this in its Estate Recovery Program pamphlet. The same section limits recovery in other ways: - DHCS can recover only for services federal law requires it to collect for. - “Estate” includes only the assets federal law requires. - There is no recovery at all if the Medi-Cal member is survived by a spouse or registered domestic partner. Heirs who keep the home can agree to a voluntary post-death lien. That lien accrues interest at the lower of two rates: the Surplus Money Investment Fund’s annual average rate for the year before death, or 7% simple interest. The implementing regulation is 22 Cal. Code Regs. § 50963. Under it, DHCS will not grant a hardship waiver if the hardship was created through estate planning, such as transferring assets before death. The federal framework sits behind the state law: - 42 U.S.C. § 1396p(b)(1)(B) makes recovery mandatory for nursing facility care, home and community-based services, and related hospital and drug costs for anyone who received them at age 55 or older. - 42 U.S.C. § 1396p(b)(3) requires every state to have an undue-hardship waiver process. - State Medicaid Manual § 3810.C specifically allows the modest-value homestead exemption, using the same 50%-of-county-average test.