Whitney Houston’s Financial and Family Woes

Gossip stories quickly spread last week, claiming Whitney Houston was broke and relying on the generosity of friends to get by. If these stories are true, they indicate a drastic financial fall for Houston who signed a $100 million record deal in 2001. Houston’s reps were quick to deny the financial claims.

However, if Houston is in financial trouble, she may foreclose on her stepmother’s home. Houston’s stepmother, Barbara Houston, sued Houston in 2008 following the death of Houston’s father, John. The suit involved a $1 million life insurance policy under which Houston was named beneficiary.  

Prior to his death, Houston loaned her father a large some of money, part of which he used to buy his house. After his death, Barbara inherited the house, but as a result of the loan, Houston owned the mortgage.  Barbara claimed that the insurance proceeds were meant to repay Houston for the mortgage, but Houston refused to credit the proceeds against the mortgage.

After Barbara sued, Houston counter-sued, making allegations against Barbara’s character and motives for marrying John. Houston asked that the court to force Barbara to repay the mortgage with interest, a total of about $1.6 million. The judge found for Whitney and dismissed the suit without holding a trial, clearing the way for Houston to foreclose on the house.  

See Danielle and Andy Mayoras, Broke or Not, Whitney Houston Now Understands Value of Estate Planning, Financial Planning Magazine, Jan. 31, 2012.

Special thanks to Jim Hillhouse (Professional Legal Marketing (PLM, Inc.)) for bringing this article to my attention.