Posted by Michael Morrongiello on August 26, 2000 at 12:04:42:
I presume you want to “borrow” against the equity that exists in this property and pull some cash out ($20K).
You will have to deal with the life estate in order to allow for an insurable valid lien be placed against the property. It is doubtful any title insurance company will be willing to insure the trust deed lien as representing a valid 1st lien unless the “life estate” interest is aware of the lien or is willing to extinguish their life estate.
As for specific chapter and verse, contact a competent real estate attorney in your area or one of your local title insurance companies should be able to shed more light on this for you.
It is likely you parents retained the life estate interest against the property for just such a reason, and that is they would want to aware of you selling or attempting to borrow against the property unknowingly.