Check Your Title: Avoiding Probate Through the Proper Use of Deeds

At Smith Jadin Johnson, it is not uncommon for us to review a client’s estate plan and discover that the client’s real estate is not properly titled to avoid probate. Whether a client has a will or a trust, it is imperative that the client’s real estate is titled in such a way that harmonizes with his or her overall estate planning goals.  The following three scenarios illustrate the most common title issues we encounter here at SJJ.

The Couple

Couples who buy a house together almost always take title as “joint tenants with right of survivorship”, meaning, upon the death of the first owner, all ownership of the property automatically vests in the surviving owner without the need for probate. Title issues with couples, whether married or not, arise when one party has already purchased the home and the other party merely moves in. Couples mistakenly believe that merely being added to the mortgage is sufficient for “ownership” – it’s not. To add a party to ownership, and thereby allow for joint tenancy and transfer without probate, the incoming spouse/partner needs to be added to title.  This is easily done by the property owner executing a Quit Claim Deed in favor of the existing owner and the new spouse/partner.

The Small Estate

Some clients do not want to share current ownership with another person, say a son or daughter, and therefore do not want to immediately put that person on title. But they do want to leave their real estate to a specific person(s) upon their death, and would like to avoid probate on the transfer.  This is easily accomplished by having the owner execute a Transfer on Death Deed or “TODD”. With a TODD, the owner executes a deed that states upon the owner’s death, title in the property shall immediately vest in whomever the owner lists. The TODD is recorded with the county, and so long as the owner does not revoke it, title will pass to the person(s) listed upon the owner’s death without having to go through probate.

The Revocable Trust

Finally, clients with revocable trusts need to ensure that all real estate is held in the name of the revocable trusts.  Trusts only protect assets from probate to the extent those assets are actually held in trust – i.e., owned by the trust. For real estate, this means all deeds must be transferred from the individual owner(s) to the trustee of the trust. This is also easily accomplished by the owner(s) executing a Quit Claim Deed to the trustee of the trust.

In sum, avoiding probate when transferring ownership in real estate is an important piece of any client’s estate plan, but also easily accomplished. At Smith Jadin Johnson, PLLC, ensuring clients have the right deeds in place to fulfill their estate planning goals is an integral part of our work. If you have questions regarding your real estate or estate plan please give us a call.