Vacation Home Partnership Agreement

Even if the whole family intends to come together to manage the family vacation home, someone should take ultimate responsibility for each task at some point. Otherwise, an important task may be cancelled or, worse, frustrated by a parent doing most of the work or bearing the burden of reminding other family members to do their fair share. Create a list of administrative tasks (both financial and physical) and assign each task to a family member or external manager. Create a method of regular re-eding because not all parents have the same skills and a family member`s motivation for a task can vary over time. The enterprise agreement, the «Rules» document for an LLC and its owners (known as members), details the administrative autonomy, rights and responsibilities of each member of the LLC (family member) with respect to the property and may be mandatory for future heirs who own the home. Another example would be that a family member has a serious car accident and is then sued by the other driver, who then gets a judgment beyond the available insurance coverage. A duly structured LLC prevents the judge from seizing the LLC shares (family member`s interests) and thus protecting their own capital to the LLC. The creditor is very likely to settle quickly because of this technical «burden protection» widely used by experienced LLC owners and their lawyers. If the house is in the possession of an LLC, the creditor cannot compel the division of the house to pay for the comparison. This protection is not available for other forms of ownership, including corporate property and condominiums.

The use of the holiday home or property must also be considered in advance. It is very easy to think that everyone is on the same side, but without talking about it, no one will know for sure. For example, you need to know if group members want to use it year-round or if they want to generate income by making it a rental property. Determine who can use it when and how long, in advance, will go a long way to prevent fighting once the purchase is complete. Splitting the mortgage is a good idea, but when people come together to own real estate, they have to be willing to compromise. Not everyone shares the same taste in home type, interior architecture and even location, so you need to understand what all parties are looking for in a home. The last thing everyone wants to do is waste time looking at real estate without agreeing on what they want. Another important issue to consider is the meeting procedure. A common situation in family communities that does not work is a parent who refuses to communicate with others. If this circumstance is not addressed in the family contract, the group may be paralyzed and unable to pay the bills and manage the basic insurance. The solution is a formal meeting and an agenda process on which it can fall back if informality no longer works.