When a person passes away, their real estate is often one of the only assets that will have to go through the court-supervised probate process. Not only is probate costly, it requires beneficiaries to operate on the court’s time schedule, which can cause unnecessary delays. With a little advance planning, however, probate can be avoided even for these assets. Below are a few options to consider so that your real estate holdings can pass without the hassle of probate.
1. Revocable Living Trust
With a revocable living trust, you create a new legal entity to own your assets. By then transferring your real estate to your revocable living trust, your successor trustee can sign to transfer the home when you can’t either because death or incapacity. Because your signature is not needed to transfer the real estate, probate can be avoided for this asset. Voila!
2. Transfer on Death Deed
Texas law has created a Transfer on Death Deed, which is a way to convert your real estate into a beneficiary designated asset, similar to how life insurance and retirement accounts operate. While you’re living, you will need to execute and record the Transfer on Death Deed in the real property records. After passing, your heirs will only need to file an affidavit in the real property attesting to your death. Again, title to the real estate can be transferred without the need for a probate proceeding.
3. Ladybird Deed
Similar to a Transfer on Death Deed, a Ladybird Deed provides a way to state who you want to receive your real estate upon your death. With a Ladybird Deed, the current owner retains what is called an “enhanced life estate,” which enables the person executing the deed to exercise certain rights of control, including the right to sell the property.
4. Heirship Affidavit
Unlike the first three options, an Affidavit of Heirship is a legal instrument that cannot be used until after death. When someone dies without a Will, but with real property titled in their name, the heirs of the owner and two independent witnesses, can execute an affidavit to transfer the property. The two independent witnesses are needed to verify the family history and heirship of the owner. The affidavit is then filed with the county’s real property records where the home is located, and title is transferred without the need for probate.
To learn more about the best tools to use when planning your estate, please join Solak Legal’s next FREE online event, “Effective Strategies for Planning Your Estate,” on Wednesday, March 24th at 4:30. A replay will be provided to all registered participants. Email Jennifer@solaklegal.com to register.
The information in this column, which was sponsored by Solak Legal as part of The Leader Expert Series, is intended to provide a general understanding of the law and not legal advice. Readers with legal questions should consult attorneys for advice on their particular circumstances. Jennifer Solak provides legal advice for families and businesses and may be contacted at email@example.com or 713-588-5744.