Momma holds a promissory note for a condo that her and dad owned. The borrower has always been inconsistent with payment even when dad was alive but she is worse now. I have been dealing with this for twelve years and to be honest I am tired of it. I have been more than easy to work with and patient and have not charged her any late fees. I e-mailed her and told her starting January 1st, 2023 I will be charging a late fee if payment is not received by 15 days after the first when due according to the terms of the note. She replied back and basically is blaming the bank for dropping there automatic bill paying service and said future payments should not be affected. Not only am I tired of this but this debt is part of momma's trust and after momma is gone the borrower will still owe payments. She has ten more years. So every month when I receive payment from borrower I have to divide it up and pay the four beneficiaries. Dad made this arrangement with this borrower because she is a friend of a friend. The promissory note also states that I can demand full payment when loan is defaulted. Should I go ahead and start the steps to collect? Also I know I might have to hire an attorney if it goes that far.
See an attorney!
After mom is gone, I would not divide the monthly payment for other beneficiaries. I would hold onto those funds and send a check to others yearly. You will not be able to close the estate until that mortgage is paid in full. Could you sell.the note to a financial institution? Or course you would have to discount the face value, but it may be worth it.
Get proper legal advice for this situation.
Has your Dad died? I don't think you should be splitting the payment every month. This is income for Mom and Dad if alive. If Mom/Dad need Medicaid at any time, giving this money to "beneficiaries" maybe seen as gifting.