However, you said your dad's will leaves his assets to the four siblings. But his will has nothing to do with his living trust, which should specify who receives the living-trust assets after his demise.

Depending on the state law where your dad was a resident, there might be an inheritance tax on the heirs. Fortunately, only a few states still have old-fashioned inheritance taxes on heirs, but there are usually generous exemptions for close-relative heirs, such as spouse, children and parents.

Congratulations to your late father for wisely transferring title into his living trust so the home can be sold and the proceeds distributed without any probate court delays or extra costs. For more details, please consult a probate attorney in the state where your father was a resident.

NO NEED FOR A REVERSE MORTGAGE UNTIL YOU WANT THE MONEY

DEAR BOB: My husband and I (ages 73 and 83) have a lot of equity tied up in our home of 40 years. Because we will probably need money in the near future for living expenses, I've been trying to convince my husband to look into a reverse mortgage. But he tells me your articles advise not obtaining one unless the homeowners plan to stay in their home at least five years. Therefore, he is reluctant to consider a reverse mortgage because we don't need the money yet. My idea is to take out a reverse mortgage now, deposit 25 percent in a liquid account to draw on if needed and invest 75 percent in an insured account with high interest. Is this a good plan? --Lorna K.

DEAR LORNA: No. If you don't need the reverse mortgage money yet, I see no reason to obtain one now and start accruing interest on money you really don't need. However, this is a good time to shop among reverse mortgage lenders to compare the FHA, Fannie Mae and Financial Freedom Plans. You can choose to receive lump sum, lifetime income, credit line (except in Texas), or any combination of payments.

If you want to arrange a reverse mortgage now, the most popular choice credit line alternative makes funds available when you need them in the future, such as for a new roof or a trip around the world.

However, although interest doesn't accrue until you start using the money, not using the available money is an expensive choice because your up-front loan fee costs start accruing interest whether you use any funds or not. More details are in my special report, "The Whole Truth About Reverse Mortgages for Senior Citizen Homeowners," available for $5 from Robert Bruss, 251 Park Road, Burlingame, CA 94010 or by credit card at 1-800-736-1736 or instant Internet delivery at www.BobBruss.com.

DON'T BE INTIMIATED BY THREATENING MORTGAGE BROKER

DEAR BOB: My husband and I were seriously considering refinancing our home loan. The mortgage broker asked if we wanted to "lock in the rate," and my husband said "yes." The very next day, after much thought, we realized the closing costs were too high and it isn't smart to proceed because we plan to move within a year. I immediately phoned the mortgage broker and told him not to proceed (I confirmed this by e-mail too). The broker continued to phone and left messages that turned nasty when he said a "denied letter" was going on our credit report because we withdrew our application. But we never signed anything and we never finalized the loan product we wanted. But a "good faith estimate" statement was mailed to us. Can this mortgage broker make our credit score lower? --Stephanie N.

DEAR STEPHANIE: No. If you didn't submit a signed loan application and didn't give the mortgage broker permission to proceed, he had no legal right to access your credit reports. Congratulations on backing out of that refinance if you plan to sell within 12 months. It would be a total waste of costs for you to refinance now.

That mortgage broker is trying to intimidate you. Even if you had applied in writing for a mortgage that was denied, it wouldn't show up on your credit reports other than as a credit inquiry.

If that bad mortgage broker gives you any further hassle, you should report the matter to the state regulator of mortgage brokers. Be sure to check your credit reports in about 30 days at www.myfico.com to verify your FICO score and to be sure there are no errors on your credit reports.

NO WAY TO AVOID TAX SELLING RENTAL HOUSE TO PAY DOWN HOME LOAN

DEAR BOB: My wife and I own two rental houses. Our goal is to reduce the mortgage balance on our principal residence. Is there any way we can sell the two rental houses and use the cash received to pay down our home loan without owing capital gains tax on our sale profits? --Mark J.

DEAR MARK: Sorry, there is no way to sell your rental houses and avoid paying capital gain tax on your profit although you want to use the cash to pay down your home mortgage balance. Fortunately, the federal long-term capital gain tax is currently only a 15 percent maximum, plus any applicable state tax where the rental property is located. For more details, please consult your tax adviser.

OCCUPANY TIME ALONE DOESN'T DETERMINE PRIMARY RESIDENCE

DEAR BOB: We own two homes where we spend about six months every year in each one. We want to sell our Florida home. But we file our income tax returns from our other home, vote there, etc. Must we change our legal domicile to Florida and file income tax returns from Florida in the year before we sell so we can claim up to $500,000 tax-free profits? --Diane W.

DEAR DIANE: Internal Revenue Code 121 says you qualify for up to $250,000 (up to $500,000 for a married couple filing a joint tax return) tax-free principal residence sale profits if you own and occupy the home at least 24 of the 60 months before its sale.

As you discovered, both your homes meet the occupancy test since you spend about six months every year living in each one. But occupancy time alone doesn't determine your principal residence.

However, if you don't vote, hold driver's licenses, register your automobile, file income tax returns, have bank accounts, etc., in Florida and you are audited by the IRS, your Florida home will probably be determined not to be your principal residence.

Just filing your income tax returns from Florida in the year of the sale and the previous year might not be sufficient, especially if you didn't record a Florida homestead. Check with your tax adviser for full details.

HOME LISTING AGENT'S $695 FEE, PLUS SALES COMMISSION, IS OUTRAGEOUS

DEAR BOB: We signed a listing contract to sell our home. While going through our papers, we found we were missing the listing agreement. We went to the broker's office to get the missing paper and found it contains a $695 "transaction fee" plus the sales commission. We do not believe we signed the agreement with that fee on it. Nothing about this fee was mentioned until we saw it on the listing agreement. Do we have any recourse? --Virginia F.

DEAR VIRGINIA: Shame on your listing agent for (1) not calling your attention to that extremely high $695 unnecessary transaction "junk" fee, on top of your sales commission, before you signed the listing and (2) not giving you a copy of the listing at the time you signed it.

Most states require the seller immediately be given a copy of the listing. You might want to report the matter to the state real estate commissioner for investigation and possible licensee discipline.

If I were in your shoes, I would be so disgusted with that listing agent I would immediately cancel the listing for misrepresentation.

The new Robert Bruss special report, "Pros and Cons of Today's Five Best Real Estate Profit Opportunities," is now available for $5 from Robert Bruss, 251 Park Road, Burlingame, CA 94010 or by credit card at 1-800-736-1736 or instant Internet delivery at www.BobBruss.com. Questions for this column are welcome at either address.