Life estate deed vs lady bird deed
Life estate deeds are a tool to avoid probate on real estate.
Attorney Tom Olsen: In a life estate deed, Tammy, within the body of the deed itself that you sign, it names who gets this piece of property when you have passed away. That might be your children, it might be friends, it might be a charity. When you do this life estate deed and you pass away, the only thing your children will need to do is record your death certificate and the public records of whatever county that property is located in, and it will automatically belong to them. No headaches, no hassles, no probate. There's two types of life estate deeds. There is an ordinary life estate deed and there is an enhanced life estate deed, also known as a Lady Bird deed.
Attorney Chris Merrill: That's the one we are doing for people. The Lady Bird deed, why? Because it means that our client, the owners of the house, they have complete control. As long as they are alive, you can do whatever you want with the home, but then when you pass away, whoever you want the home to go to, it means that it's easy and they avoid probate because of the Lady Bird deed.
Attorney Tom Olsen: With the Lady Bird deed, also known as enhanced life estate deed, the beauty of that is that you reserve the right to change your mind at a later date without your children's knowledge, signature, and consent. If we do a Lady Bird deed for you today, and you leave it to your three kids, and six months from now, you sell the property or refinance it or change it, you don't want to leave it to two of your kids, you can do so without their knowledge, signature, and consent. Chrissy, every once in a while, somebody will ask me this question about, "Hey, Tom, who would do an ordinary life estate deed?"
Attorney Chris Merrill: Once in a while, it's the right tool.
Attorney Tom Olsen: Yes. Here's where I've used one before, and that is this. A mom who was still competent comes in my office with her kids. They are concerned because there's people that walk around the neighborhoods, and they knock on the doors of these elderly people. They say, "Do you want us to repave your driveway or you want to put new windows in or you want to put solar power in? Here, just sign on the dotted line." Before you know it, mom has spent $10,000 on $1,000 worth of work, and she's put a lien on her home for that work. There were concerns she'd already done that once. They were concerned, they didn't want it to ever happen again. For her, we did an ordinary life estate deed. Still a powerful tool to avoid probate, but now with an ordinary life estate deed, mom could not put a lien on that property or remortgage it without the knowledge, signature, and consent of her kids. In a way, we kind of locked it up so that nobody could rip mom off.
Attorney Chris Merrill: There are certain situations exactly like you just described, Tom, that it is the right tool that we would do that in those limited circumstances. Otherwise, we are doing the enhanced life estate deed, also known as the Lady Bird deed, and we have a great booklet on that for you. You can go to our website at olsenlawgroup.com and write on our homepage. We have a picture of the booklets. You can easily request the booklet with your name and mailing address, and we will get that out to you. Again, it's a great introductory information. Then, we are happy to answer further questions about this great tool, Lady Bird deed, available to avoid probate here on your real estate in Florida.
Attorney Tom Olsen: Thank you, Chris. We appreciate that.