How does a life estate deed work and how does it work?
How Life Estate Deeds Work Life estate deeds work by dividing the property into two types of interests. One interest is measured based on the owner’s lifetime and is called a life estate. The interest that passes at the owner’s death is called a remainder or remainder interest.
What happens to the property of a life estate?
The person who holds a life estate has the right to possess the property during his or her lifetime. The interest that passes at the owner’s death is called a remainder or remainder interest. The person who holds a remainder interest does not have the right to possess the property until the life tenant’s death.
What happens to a deed when the occupant dies?
Through a deed, the grantor creates a life estate allowing the life tenant to live in the home and naming a remainderman to receive the property when the occupant dies. The deed is typically recorded with the county government office that handles real estate records.
Can a remainderman live in a lifetime estate?
This form of property ownership guarantees that they cannot be forced to move from his or her home. The remainderman cannot live in the property during the life tenant’s occupancy of the home unless they previously consent. During occupancy of the home, the occupant pays all property taxes and maintenance costs on the house.
Who is the remainderman on a life estate deed?
A life estate deed is a transfer of the ownership of the real property that is the subject of the deed to one or more persons (the “remainderman”), while retaining ownership of a life estate in the property by the person(s) transferring the property (the “life tenant”).
What is the purpose of a life estate deed?
Typically, the purpose of a life estate deed is to provide for the transfer of the property to the desired person (s) (remainderman) automatically at the death of the property owner who retained the life estate (“life tenant”), without the necessity of probate. Ownership of the property transfers automatically upon the life tenant’s death.
What is a living deed?
A life estate deed is a legal document that changes the ownership of a piece of real property. The person who owns the real property (in this example, Mom) signs a deed that will pass the ownership of the property automatically upon her death to someone else, known as the “remainderman” (in this example, Son).
Are there any drawbacks to a life estate deed?
There a few drawbacks to a life estate deed: Mom loses complete control of the property. While she gets to live in it the rest of her life, she can’t sell it to anyone, take out a mortgage, or control what happens to it after her death.