How to Transfer Real Estate Upon Death Without a Will or Trust?
October 25, 2021 - Categories: Legal Articles
Usually, if you die without a will or trust, your estate will be distributed based on state laws of intestate succession. Dying intestate means that there is no legal document setting out your wishes for your estate. But there is another option.
Known as a “life estate deed” this is a document that will ensure that ownership of real property passes automatically to a specific person when you die, but also allows you to continue living there as long as you are alive.
Why Choose a Life Estate Deed?
In many ways, when it comes to real property (which is what the law calls your home), a life estate deed is better, for several reasons:
- There’s no probate required for property ownership to change hands, because it essentially already has.
- You don’t need to include the property in your will – although you can still have a will for other items you want to leave to other family members.
- There’s no gift tax when you transfer property using a life estate deed.
- Since life estate deeds are legally binding, there won’t be any arguments or long-drawn-out processes when you die.
- You can continue to live in your home as long as you choose to.
In many ways, a life estate deeds provide peace of mind and simplify the legal process after you die.
What Should You Consider?
Of course, like most legal issues, there are a few things that might make a life estate deed the wrong choice for you, including:
Loss of legal control – once this deed is in place, you can’t sell the property, take out a mortgage or leverage it in any other way
You will still be liable for property taxes as long as you live
There is no easy way to undo a life estate deed – once it’s signed, only the beneficiary can reverse the process
As with any estate management options, there are pros and cons to creating a life estate trust. The regulations and procedures also vary greatly, depending on where you are, what your particular situation is, and other factors. This is not a process that you can DIY, so if you want to find out more, you should speak to an attorney who specializes in estate law.
Although this is the general rule in most states, the specific laws of how this topic is dealt within each state vary; therefore, we strongly recommend scheduling a free phone consultation with one of our local in-network affordable attorneys for advice on how this topic applies to your given legal situation, in your particular state.
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