Life estate deed is used by many people to pass on their real estate properties directly to their heirs without the need of a probate. In the absence of one, your heirs will have to hire a lawyer to clear the title in the court so that they can own/sell the property.
Why is a Life Estate Deed?
- It is one of the most cost-effective way of securing your property in the name of your heirs. The process of establishing this deal is also very simple, with only the present owner(s) required to sign a new Deed. The total cost varies between $275-$300.
- As mentioned earlier, one of the most important benefits is that upon the death of the owner, the property automatically passes over to the nominated heirs, which helps in avoiding probate.
- The heir to whom the property is to be passed to after the death of the owner, cannot claim the property for difficulties like bankruptcy, lawsuits, accidents etc.
- If the real estate is not sold by the owner until his death, the heirs get the full benefits of a stepped up income taxes for capital gains purposes.
- It helps for purposes of Medicaid eligibility and protection from Medicaid recovery by the state.
|This Deed is made on this day of _______________, 20__, between the Grantor ___________
___________________ of address __________________________________________________ and the Grantee ______________________________ of address _________________________
WITNESSETH, That the Grantor, for good and valuable consideration paid by the Grantee, the receipt of which is hereby acknowledged, does grant, sell and convey unto the said Grantee, all the rights, title, interest, claim or demand that the Grantor may have in the following described real property:
EXPRESSLY RESERVING Life Estate in the above described property unto the Grantor and its assigns. The Grantor shall have full ownership, possession and use of the property, as well as the rents, revenues and profits generated by the property during the term of the Grantor’s natural life.
Upon the expiration of the Grantor’s natural life, the ownership, possession, use, rents, revenues and profits of the above described property shall revert to the Grantee.
EXECUTED this day of _______________, 20__.
On this day, personally appeared before me, _________________________, to me known to be the person(s) described in and who executed the within instrument, and acknowledged that he/she signed the same as his/her voluntary act and deed, for the uses and purposes therein mentioned.
Witness my hand and official seal hereto affixed on this day of _______________, 20__.
Notary’s Public Signature: ______________________
My commission expires _______________.
(Life Estate deed forms may vary from state to state)
Home is one of the largest assets for many people. Transferring full ownership to your heirs while you are still alive, places your right and security of the home at risk. Life estate deed provides the middle way out for transferring ownership in a very simplistic and easy way.