Successful Sellers Know How to Think Like Buyers

So would we be safe by quitclaiming the house to my sister?

If someone has already placed a lien on your property, quitclaiming the property to someone else will not help you. In addition, due to your circumstances, if you quitclaim the property to your sister, that transfer may be considered a fraudulent conveyance. In many states, creditors are given the right to look back at the assets a debtor had and may have transferred and not received any money for the transfer. They could try to undo the transfer, and your sister would become part of the litigation.

You should see whether there are any unexpected liens that affect your home. In many counties, you can search online to determine whether a lien has been placed on your home. Check with your local county or local recorder of deeds Web sites so you can review any clouds to your property's title.

If there are no liens on your home and you can sell before any liens are placed on it, you would have the proceeds from the sale in your hands.

Let's assume there are no liens on your home. If you quitclaim your home to your sister and she doesn't pay you cash for the property, that transfer of wealth from you to her could be challenged by your creditors.

If you're in the process of selling, your best option is to stay the course and get your home sold. Once the home is sold, you can pay off the creditors who have liens on your home, including a first or second mortgage lender.

If, in the course of the litigation, someone places a lien on the home, you may also have to pay off that lien or deposit the funds to pay off the lien with the court handling the litigation. More important, once you have the money from the sale of the home, you can use those funds to pay for any of the bills that have come due for your husband's care.

Unfortunately, other than selling the property and getting the cash from the sale, there isn't much a person can do in terms of asset protection once litigation has started or creditors have filed liens against a home.

On a second issue, if you feel that your insurance company or the other party's insurance company has failed to meet its obligations under your policy or under the policy that covered the other driver, you might want to seek assistance from the department that regulates insurance companies in your state. Some states are better at handling those complaints than others.

Also, some states have consumer-protection statutes that give you the right to challenge the insurance company's denial of your claim.

You might find it worthwhile to engage the services of a lawyer who might sue the insurance company to force them to pay up.

If you started that process, and that is what is coming to trial next year and you are the plaintiff in the litigation, you might have to wait until the trial date to see where things end up. Your lawyer should be able to advise you whether the insurance company might be liable for its failure to settle. In some states, that failure to settle -- if done in bad faith -- can lead to an increased recovery to you, if you are the plaintiffs in the case.

Ilyce R. Glink is an author and nationally syndicated columnist. Her latest book is "100 Questions Every First-Time Home Buyer Should Ask." Samuel J. Tamkin is a real estate lawyer in Chicago. If you have questions for them, write Real Estate Matters Syndicate, P.O. Box 366, Glencoe, Ill. 60022, or contact them through Glink's Web sites,http://www.thinkglink.comand http://www.expertrealestatetips.net.

© 2008 Ilyce R. Glink and Samuel J. Tamkin

Distributed by Tribune Media Services