There are a number of ways to transfer your home, or other real property, on your death, including joint tenancy with right of survivorship, beneficiary deed, will or trust.
Joint Tenancy and Beneficiary Deed
If you own your home with another person with right of survivorship, your share of the home will automatically transfer to that person on your death. All they need to do is record your death certificate with the county the residence is located in. This is the most efficient way to transfer ownership of your home on your death. However, if you are the sole owner of the property, you probably do not want to transfer part of your ownership during your lifetime.
A beneficiary deed allows you to maintain complete ownership of your home during your lifetime and immediately transfer it to a beneficiary on your death. It does not prevent you from selling your residence and you can revoke the beneficiary deed prior to your death. A beneficiary deed typically names an individual or a trust as the beneficiary. It should not name a charitable organization. Charities typically do not want to have to sell your home themselves. If you would like to gift the proceeds from the sale of your residence to a charity on your death, you should make this gift through a will or trust. This way, the personal representative of your estate or successor trustee of your trust can sell the property and make the transfer.
Will
You may want to transfer your home through your will if you want to avoid having multiple people named on the deed. Your beneficiaries may not get along at the time of your death, even if you think they would get along now. Further, it is more difficult to make decisions regarding the sale of a property when multiple people are on the deed. All beneficiaries would have to agree on a realtor, sale price and other details related to the sale.
If you have minor children, beneficiaries who cannot manage assets or beneficiaries on public benefits, you may want to consider a testamentary trust. A testamentary trust is a trust created by your will through the probate process. This would allow a third party to manage the home for the benefit of your beneficiaries without the home being titled in their name. You can choose to transfer ownership of the residence to the beneficiary when they reach a particular age or meet some other condition.
Trust
If you have a revocable trust as part of your estate plan, you have probably titled the home to your trust or executed a beneficiary deed transferring the home to your trust on your death. Either of these methods allows the successor trustee of your trust to dispose of your property on your death according to the terms of the trust. The trustee could execute a deed transferring the residence from the trust to the beneficiary named in your trust or hold the residence in trust for the benefit of your beneficiaries.
Further, you may want a beneficiary to be able to live or continue living in your home on your death without them owning your home. You can create a right to reside provision in your trust that allows the trustee to hold the residence in trust and allow your beneficiary to live there. The trust can allow the beneficiary to remain in your residence for a number of days or for the rest of their life. Also, you can choose to have expenses related to the property paid from the trust or by the beneficiary. When the beneficiary’s right to reside ends, the trustee can transfer your residence to your remainder beneficiaries.
Conclusion
The best way to transfer your home on your death really depends on your estate planning goals, but all of the above options are worth considering. However, we do not recommend trying to keep your home in your family forever.
