Legal Question in Wills and Trusts in New Jersey

Re: Legal Agreement between Father son and Daughterin law about a Personal Loan

If the insurance is "paid-up" have him assign the policy to you.

Or you can have him name you as the beneficiary, and have your son and daughter-in-law sign an agreement to name you as beneficiary so long as the loan is unpaid. If your son dies, and they did not name you as beneficiary, you would have a claim against his estate for the policy proceeds.

Re: Legal Agreement between Father son and Daughterin law about a Personal Loan

You need more than a legal document. You need some good legal advice. Get a consultation with a lawyer and get some specific advice on your situation.

My intuitive feel based on what you have told me is that your borrowing money on your house to pay your son's debts would be a very bad thing for you and probably wouldn't help him in the way that you intend. Unless you are so wealthy that you can throw that money away, you need to talk to somebody who understands the pitfalls. Life insurance isn't your only problem.

See also: http://info.corbettlaw.net/lawguru.htm

Re: Legal Agreement between Father son and Daughterin law about a Personal Loan

If you are not listed on the policy as one of the named beneficiaries, you receive no part of the policy proceeds, so I strongly suggest a new beneficiary designation form be filed with the insurance company which names you to receive part of the policy proceeds upon his demise. Additionally, I suggest a Mortgage be recorded reflecting your loan as a lien against the property. This would also assure that you get paid if he tries to sell the house or merely register it in his wife's name. The Mortgage should be signed by both your son and his wife, and be supported by a Promissory Note also signed by both. Not trying to berate you, this is what happens when an attorney is not consulted from the inception of the transaction.