Where or how can an executor with fiduciary power of an estate use EE Bonds as collateral to borrow against? Thank you!
Without going to jail? Tough one. Heirs can get Probate Loans like J.G. Wentworth, but they will get robbed blind. Executor An Executor is named in your Will to shepherd your probate assets through the probate court process and ultimately to your beneficiaries upon your death. Probate assets, to make things even more complicated, are those assets in your name alone, as opposed to being held jointly, in trust, or in an account that utilizes designated beneficiaries. Where the Attorney-in-Fact’s power stops, the Executor’s power starts. In other words, an Executor has power only upon your death, over your probate assets only. Trustee If you have a trust, you have named a trustee to manage, invest, and distribute the assets in your trust. Unlike an Attorney-in-Fact, whose powers are limited to the period of time you are alive, or an Executor, whose powers are limited to a period of time after you die, your Trustee can serve both during your lifetime and after your death. A Trustee’s powers, however, are limited to those assets held in the trust. A Trustee has no power over assets outside of the trust. Attorney-in-Fact v. Successor Trustee- During Your Lifetime When you become incapacitated, the authority granted to your Attorney-in-Fact will be activated under your Power of Attorney, and the power granted to your successor trustee will be activated in your trust. The scope of their respective decisionmaking authority will depend on the extent to which you have funded your trust. Your Trustee has exclusive jurisdiction and control over the assets in your trust, your Attorney-in-Fact has jurisdiction, subject to any limiting terms in the Power of Attorney, over everything else. If you have a trust and have funded it with all of your assets, your Attorney-in-Fact is going to thank you for making his/her life relatively easy. Executor v. Successor Trustee- After Your Death Upon your death, your Attorney-in-Fact’s power ceases and your Executor’s power, assuming he or she is appointed by the Probate Court, commences. Your Executor, however, only has power over those assets not in trust, not held jointly, or not in an account with beneficiary designations. Accordingly, the Executor role may be limited. If you have a trust and funded it with most of your assets during your lifetime, your successor Trustee will have comparatively more power than your Executor. Conclusion “Attorney-in-Fact,” “Executor” and “Trustee” are designations for distinct roles in the estate planning process, each with specific powers and limitations. An easy take-away: Trustees have power of Trust assets both during and after your lifetime; your Attorney-in-Fact has power over your non-trust assets during your lifetime; and your Executor has power over your Probate assets upon your death. If you have any questions about the role of any of these positions, contact an estate planning attorney at Donahue Tucker & Ciandella, PLLC.
Ask www.interactivebrokers.com if the estate can open an account and then deposit the bonds and wire out a margin loan.
I'm not an executor but a beneficiary. We the beneficiaries are just trying to find out what the executor could have possibly done with the EE Bonds since the Bonds have reached final maturity dates years ago and they are not liquidated yet. Any thoughts??? Below is what I read online but I'm not quite sure it's detailed enough. What's your thought on this article? If you hold the government bonds yourself, you can either open a margin brokerage account, put the bonds in the account, then borrow against them, or you can borrow from a bank using the bonds as collateral. In many instances, it may be easier to open up a margin account and borrow against the bonds in the account than to get a bank loan using the government bonds as collateral. Liquidating the bonds, should you later need additional cash, is generally easier when they are already in a brokerage account. Thank you for your time!
If the executors created a margin account and borrowed against them, do you think the loaner would be required to report to the Treasury Department so that the Treasury Department would know who is presently holding the bonds? I also like to add, I am not an executor but a beneficiary and we are trying to figure out what they have done with the bonds since they have reached final maturity dates years ago and are not liquidated yet. Thank you!
No, I do not have the actual bonds or certificates. What I do have is the Inventory Report listing all of the serial numbers. I contacted the Treasury Department and ran the serial numbers through and they all came back not liquidated.
The US Treasury stopped issuing paper EE bonds many years ago. But if they were issued many years ago, they may still exist in paper form. It is not unusual for paper bonds to get lost or misplaced. There is a process for replacing bonds that have been lost, stolen or destroyed. It is not unusual for holders of EE bonds to be unaware of the maturity dates, especially if they are elderly, disabled, or cognitively impaired. EE bonds are savings bonds. I don't think they can be traded on an exchange. There is a process for transferring ownership, but I don't think they are marginable securities. In general, EE bonds can only be registered to an individual. They cannot be registered to an entity. There may be an exception for estates. I don't think they can be "deposited" into a brokerage account. Savings bonds are not usually treated as marketable or fungible securities. They are something else. BMK
Thank you for that but I was hoping to find someone in this forum that could give a possible educated guess of what the executor has done with the EE Bonds. Please let me explain a little bit more. The executor of my uncle's estate tried to shortchange the beneficiaries in the amount of the EE Bonds named in this thread. The executor of my uncle's estate has been contacted by our attorney and now the executor would love nothing more and liquidate the bonds so that there is no further action taken on the executor. I have all the Serial Numbers of the bonds and I ran them through the Treasury Department months ago and even until this day they are still not liquidated and have reached final maturity dates years ago. The executor doesn't have the money to distribute to the beneficiaries because the money is tied up in the EE Bonds. The only thing we the beneficiaries can figure out is that the executor used the EE Bonds as collateral somehow??? Let's say the executor lost the bonds, they can easily have them reissued by the Treasury Department and then liquidate them and distribute the proceeds to the beneficiaries and be done with us. Do any thoughts come to mind? Thank you!