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Avoiding Probate: An Overview of Transferring Real Property Without Going Through Probate

Introduction

Transferring real property without probate can be a complex and confusing process. In this article, we will explore the various methods for transferring real property without going through probate, including transfer on death deeds, joint tenancy, life estates, and living trusts. We will also compare the advantages and disadvantages of each method and provide tips on how to choose the best probate avoidance technique for your specific circumstances.

Transfer on Death Deeds

A transfer on death deed (TODD) is a legal document that allows a property owner to transfer their real property to a designated beneficiary upon their death. This method of transfer is relatively new and is not currently available in all states.

To use a TODD, the property owner must execute the deed while they are still alive. The deed must also be recorded with the county recorder's office. Upon the property owner's death, the beneficiary named in the TODD becomes the new owner of the property, without the need for probate.

One advantage of using a TODD is that it allows the property owner to retain control of their property during their lifetime. Additionally, because the transfer occurs outside of probate, it can save the beneficiary time and money. However, it is important to note that TODDs are currently only available in a limited number of states and may not be recognized in all states.

Joint Tenancy

Joint tenancy is another method of transferring real property without probate. In a joint tenancy, two or more individuals own the property together. When one joint tenant dies, the remaining joint tenants automatically become the owners of the deceased's share of the property.

To establish a joint tenancy, the property must be owned by all of the joint tenants as "joint tenants with right of survivorship." This means that each joint tenant has an equal share of the property and that upon the death of one joint tenant, their share automatically passes to the remaining joint tenants.

One advantage of joint tenancy is that it can be established relatively easily. However, it is important to note that all joint tenants must have an equal share of the property and that the property cannot be sold or encumbered without the consent of all joint tenants. Additionally, if a joint tenant incurs debt, the property may be at risk.

Life Estates

A life estate is a method of transferring real property that allows the grantor (the person transferring the property) to retain the right to use and occupy the property for the remainder of their life. After the grantor's death, the property passes to the remainderman (the person who will inherit the property after the grantor's death) without the need for probate.

To establish a life estate, the grantor must execute a deed transferring the property to the remainderman, but retain the right to use and occupy the property for their lifetime. This type of deed is known as a "life estate deed." It is important to note that the grantor loses any right to sell or encumber the property once it is transferred to the remainderman.

One advantage of a life estate is that it allows the grantor to remain in their home for the remainder of their life while also ensuring that the property will pass to the remainderman without the need for probate. However, it is important to note that the grantor loses any right to sell or encumber the property once it is transferred to the remainderman.

Living Trusts

A living trust is a legal document that allows a property owner to transfer their real property to a designated beneficiary upon their death, without the need for probate. In a living trust, the property owner transfers their property to a trustee, who holds the property for the benefit of the beneficiary.

To establish a living trust, the property owner must execute a trust document and transfer their property to the trustee. The trust document must also be recorded with the county recorder's office. Upon the property owner's death, the beneficiary named in the trust becomes the new owner of the property, without the need for probate.

One advantage of using a living trust is that it allows the property owner to retain control of their property during their lifetime. Additionally, because the transfer occurs outside of probate, it can save the beneficiary time and money. It also provides more privacy compared to probate court proceedings which are public. However, it is important to note that setting up a living trust can be complex and may require the help of an attorney.

Comparison of Probate Avoidance Techniques

When considering different probate avoidance techniques, it is important to consider the advantages and disadvantages of each method and to consult with a qualified attorney or financial advisor to determine the best option for your specific circumstances.

Transfer on death deeds, joint tenancy, life estates, and living trusts all have their own advantages and disadvantages.

  • Transfer on death deeds may be relatively simple to set up, but they may not be recognized in all states.
  • Joint tenancy has the benefit of being relatively easy to establish and automatically transferring ownership to remaining joint tenants upon the death of one joint tenant, but it may not provide as much flexibility as other methods and the property cannot be sold or encumbered without the consent of all joint tenants.
  • Life estates allow the grantor to retain the right to use and occupy the property for their lifetime, but the grantor loses the right to sell or encumber the property once it is transferred.
  • Living trusts provide a private way to transfer property and retain control during lifetime, but they require a trustee and can be complex to set up.

It is also important to consider the long-term implications of each method. For example, transfer on death deeds and joint tenancy may not provide as much flexibility as a living trust, which can be amended as needed. Additionally, a living trust can also provide asset protection and can be used for estate planning purposes.

Conclusion

In conclusion, there are several methods available for transferring real property without going through probate, each with their own advantages and disadvantages. It is important to consult with a qualified attorney or financial advisor to determine the best probate avoidance technique for your specific circumstances.

Contact Heritage Law Office Assistance in Transferring Real Property Without Probate

At Heritage Law Office, we understand the complexities of transferring real property without probate. Our experienced attorneys are dedicated to helping our clients navigate this process and make informed decisions about the best probate avoidance technique for their specific circumstances. We pride ourselves on providing personalized and professional service to each and every one of our clients.

Contact us today by calling 414-253-8500 or by sending us a message to schedule a consultation and learn more about how we can help you.

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For a comprehensive plan that will meet your needs or the needs of a loved one, contact us today. Located in Downtown Milwaukee, we proudly provide legal advice to those in Milwaukee County and surrounding communities.

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