All other assets will need to be passed down via a will, a trust, or another vehicle. Only Applies to Real Property : Lady bird deeds can only be used to transfer ownership of real property.Title Insurance Can Be Tricky: Title insurance companies may not want to insure a property subject to a lady bird deed, especially if there are multiple beneficiaries.They would all need to agree on what to do with the property. Not Ideal for Multiple Beneficiaries : A lady bird deed is not ideal if you want to leave the property to multiple beneficiaries.Maintain Control: With a lady bird deed, you maintain the right to sell or mortgage the property without having to get the beneficiary’s consent.Under Texas Medicaid rules, properties that transfer outside of probate are generally exempt from Medicaid Estate Recovery claims. Avoid Medicaid Estate Recovery : If the property doesn’t have to go through probate, your beneficiary may be able to avoid a claim from the state for Medicaid payments.Upon your death, the property will be transferred to your beneficiary automatically, avoiding the probate process. Avoid Probate: Lady bird deeds streamline the property transfer process.Lady bird deeds have many advantages, but there are also some drawbacks that must be considered. Advantages and Disadvantages of Lady Bird Deeds The only exception is if the property is to be transferred for the purpose of the Medicaid Estate Recovery Program.Īs you can see, transfer on death and lady bird deeds are similar, but they differ in a few important ways. Creditors can use the property to satisfy outstanding debts. Properties transferred through a transfer on death deed are not exempt from claims against the estate.Lady bird deeds do not have this requirement. For a transfer on death deed to activate, the beneficiary must survive the grantor by 120 hours.However, transfer on death deeds cannot be signed by an agent with power of attorney.

Lady bird deeds can be signed by an agent who has been given power of attorney to act on the property owner’s (grantor’s) behalf.However, these two types of deeds differ in a few ways. Many other states use what is called a transfer on death deed, which is similar to a lady bird deed (Texas allows for the use of both lady bird deeds and transfer on death deeds). Lady bird deeds are only approved in a few states: Texas, Florida, Michigan, Vermont, and West Virginia.

The Differences Between Lady Bird Deeds and Transfer on Death Deeds

Mortgage or sell the property and keep the proceeds.

Live on, use, possess, and even collect income from the property.

It provides all of the same benefits of a traditional life estate deed, but you keep the right to: It’s a streamlined way to pass down a home, but there is a catch: you can’t sell or mortgage the property without the beneficiary’s consent.Ī lady bird deed is considered an enhanced life estate deed. Upon your death, the property immediately transfers to the beneficiary designated in the deed. With a regular life estate deed, you-the owner of the property-have the right to live on your property until your death.

Conveyance of property to a trust texas