A special type of deed that is recognized by common law in Florida, Michigan and Texas that can be used to transfer ownership of real estate outside of probate to the beneficiaries named in the deed.
With an "enhanced" life estate deed, the owner of the real estate, referred to in legalese as the "life tenant," will retain complete control over the real estate while he or she is alive. This means that the life tenant will have the right to mortgage or sell the real estate without the consent of the beneficiaries named in the deed, referred to in legalese as the "remaindermen." Contrast this with a "regular" life estate deed, in which the owner of the real estate is making a gift of the remainder to the remaindermen and therefore cannot mortgage or sell the real estate without the permission and joinder of the remaindermen.
- District of Columbia
- New Mexico
- North Dakota
In Florida, Michigan and Texas, an enhanced life estate deed or "Lady Bird Deed" functions in a manner similar to a beneficiary deed or transfer on death deed or affidavit.
If you are considering using an enhanced life estate deed in Florida, Michigan or Texas in order to avoid probate, then it will be important to have an estate planning attorney draft the deed in order to inadvertently avoid creating a "regular" life estate deed instead of an "enhanced" life estate deed.
NOTE: State laws change frequently and the information above may not reflect recent changes in the laws. For current tax or legal advice, please consult with an accountant or an attorney since the information contained in this article is not tax or legal advice and is not a substitute for tax or legal advice.