Can joint tenancy help me avoid probate?

On Behalf of | Aug 5, 2020 | Estate Planning |

Most of the time, it is wise to take all steps possible in order to avoid probate. Probate can be very expensive, public and time-consuming.

However, not all strategies to avoid probate are wise. Many seniors consider putting a child’s name on their house deed as a way to avoid probate. In some ways it seems like the perfect solution: your house goes automatically to your child upon your death and there is no probate involved. However, according to In Charge Debt Solutions, this is a probate-avoiding strategy that often causes more problems than it solves.

What is joint tenancy?

With joint tenancy, there is something called the “right of survivorship.” Essentially, if one party who owns the property dies, the property automatically goes to the surviving party. There is no probate.

Why is this a bad idea?

Putting somebody else’s name on the deed to your home means that the home becomes their asset immediately. For example, if you put your child’s name on the deed to your home and he or she marries, this can cause problems if your child gets divorced. The courts will consider the home as part of your child’s marital assets. The courts may divide the house up between your child and the spouse after the divorce. This means that your child’s ex-spouse could very well end up with a share of your home.

If your main goal is to avoid probate, the best path to choose is a revocable living trust. In this way, the house becomes the property of the trust and will pass to who you wish to own the house after your death without probate.

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