Homes are one of the greatest and most expensive assets many people have. As a parent, you may want your children to have your home after you die, but to ensure that your children are left with your home, there are some important steps that you must take.
Your children will only be left with your home if you have implemented one of these three options. Take some time to consider these options, talk to your family about them, and take the necessary pre-planning steps to ensure that your greatest asset remains in the family.
We strongly encourage you to discuss your options with an experienced estate planning attorney to determine what works best for your unique situation.
#1: Include Your Home in Your Will
In your will, you specify who your beneficiaries are that will inherit your assets after you pass away. By including your home in your will, during the probate process the court will ensure that your home is transferred to your children since they are listed as your beneficiaries. If you have more than one child, each child will inherit an undivided interest and must decide together whether to keep the house or sell it. Additional hassle and expense may be incurred if your children can’t agree on what to do with the home.
#2: Have a Living Trust
Set up a living trust so that when you die, your assets are transferred to your children. A benefit of setting up a living trust rather than just including your home on your will is that it saves time. Your children will not have to go through probate and will avoid expenses and delays that come with that process. The transfer of your home to your children will be a quick process with a living trust and will prevent them from spending excess money and time on the probate process. In addition, the Trustee you’ve selected to manage the trust can make a final decision on what should be done with the house if your children cannot agree. You must also transfer your house to the living trust before you die, otherwise the house will be forced to go through probate before being transferred to your children. A living trust is a seamless way to transfer assets to your children and may reduce conflict.
#3: Use a Transfer on Death Deed to Transfer Your Home
You can use transfer on death deed to ensure your home is given to your children without having to wait through probate or setting up a trust. With a transfer on death deed you own your home while you are alive and you can do whatever you’d like with it, for example, get a reverse mortgage. After you pass away, your home is immediately transferred to your children who you listed as beneficiaries in the deed.
However, there are a lot of issues that can arise with if you choose to pass your property to your children using this option. For example, if any of your children are minors when they inherit the property or your children don’t agree on what should be done with the home, a court proceeding will still be necessary. This results in additional delays and expenses. Another issue is that Minnesota law would require your children and their spouses to sign documents to sell the home even though the spouses are not owners. If you have three children who are married, your children and their spouses need to sign documents to sell the home. How often do you find six people that agree on anything?
If you have any further questions about how to ensure that your children are left with your home, give us a call – we can help you get things started.
Give us a call at 651-478-8999.