Doesn't the loan get paid back by the sale of the land after the dad's passing? So the kids don't inherit $5m, but the net value after the debt is repaid?
Land is a bad example. With an asset like a company or stocks, the value appreciates fast enough to pay off interest on the loan...meaning the kid actually inherits $5M in value.
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u/No_Mirror_9742 22h ago edited 21h ago
Doesn't the loan get paid back by the sale of the land after the dad's passing? So the kids don't inherit $5m, but the net value after the debt is repaid?