16 Aug
Our property is valuable to us and deciding to who to give our property to after we die is a major decision. Dallas property owners may be uncomfortable with the thought of their property passing through the probate process and any potential complications along the way. Thankfully, there are 3 special deeds available in Texas which can help avoid the probate process: a ladybird deed, a life estate deed and a transfer on death deed.
A ladybird deed allows you to continue living in your home, with your beneficiaries named on the deed receiving the property upon death if you still own the property. A ladybird deed allows you to obtain a mortgage on the property, if necessary, as well, with the property still going to your beneficiaries after death.
Unlike a ladybird deed, a life estate deed transfers the property to your named beneficiaries while you are still alive. You are allowed to continue living in the property during your lifetime; however, you must pay for any mortgages and taxes. It is also your responsibility to pay for any necessary repairs to the property. If you want to sell the property, you and all beneficiaries on the deed must agree on the sale.
The third type of special deed is a transfer on death deed. This special deed transfers to your named beneficiary upon your death. However, this type of deed must be signed and filed in the county where the property is located. This must be done before your death for the deed to be legally valid.
Additional advantages
Another benefit to all 3 of these special deeds is that they can sometimes be used to protect real property from a claim by the government for the cost of any state sponsored services you received while you were alive, including any time spent in a state-run nursing home. They can also protect property from a Medicaid Estate Recovery Program.
There are pros and cons to each of these special deeds. Talking with a trusted advisor about which deed may be best for you depending on your circumstances could be helpful.