When someone dies, their estate may consist of all kinds of property – financial accounts, baseball card collections, cars, and real estate such as the family home or a plot of land they purchased as an investment. If you find yourself the beneficiary of a piece of real estate, there are a number of things that you need to understand about your rights, the transfer of property, and how probate can impact what you are permitted to do.
Does the property have to go through probate? Can you sell it? Can you start living there?
Below you’ll find information on how the probate process in Florida affects the transfer of real estate after death – and how you can avoid it.
How Probate Can Impact a Piece of Inherited Real Estate
If you learn that you have inherited real estate from someone, your first instinct may be to dive in and figure out what you want to do with it. Unfortunately, you may not have a whole lot of say – not at first, anyway.
Being named as the beneficiary of real estate means nothing until you are able to obtain clear title, and in many cases that means going through the Florida probate process. In other words, it’s yours… but it’s not completely, officially yours.
This can create a complicated situation, especially if your intent is to sell the real estate. Essentially, because the property is yours, you can go ahead and try to make that sale. You can work with a realtor. You can have people look at the property. You can even enter into a contract with someone who wishes to buy it.
But you can’t actually sell it until it has gone through the probate process and you officially get that clear title.
How it works is that you and the hopeful buyers enter into what is known as a “contingency” sales contract. They agree to buy the property contingent on your ability to prove ownership by getting the title. These kinds of agreements are not uncommon, but because they can be legally complicated, you should probably seek the counsel of a lawyer before entering into one.
The downside for both parties in this situation is basically the same: you are at the mercy of the probate process. Best case scenario, you won’t be able to officially complete the sale for six months or so. But because probate can be unpredictable, you should plan for the possibility of the sale stretching out for a year or more. And if anyone challenges your right to the property through litigation, things may take even longer and become more complicated.
If only there were ways to transfer real estate without having to go through probate. Well, as it turns out, there are.
Real Estate Properties That Don’t Have to Go Through Probate
There are a number of ways that real estate can be transferred from one person to another without having to enter into probate. Some involve the way in which they were purchased, while others simply require the owner to take a special step to ensure immediate transfer.
Tenancy by the entirety. When a husband and wife purchase a property together. Florida recognizes something called “tenancy by the entirety” whereby the spouse immediately inherits that property at the moment the other spouse dies. At that point, they become the sole owner and may do with the property whatever they wish.
Joint tenancy. Husbands and wives aren’t the only ones who can do this. There are similar provisions when two or more people own equal amounts of the same property. It’s called joint tenancy and it applies for all kinds of relationships – fathers and sons, unmarried couples, friends, and so on. Basically, if you own property with someone else and that person dies, the property passes on to you without probate. Of course, if there are other owners involved as well, all of you would have to agree on what to do with the property.
Lady Bird Deeds. A Lady Bird deed essentially says that you own a real estate property for life and that you wish to give it to a specific person – for the length of their life – when you pass on. For example, if a widowed father owned a house and wanted to pass it on to his daughter without forcing her to go through probate, he could create a Lady Bird deed to do this. Your named beneficiary simply has to file your death certificate in the land records and they automatically gain control of the property.
Real estate can also be held in trusts, and there are other, additional tools you can use to speed up the transfer process. A knowledgeable Florida estate planning attorney will be able to walk you through the options available and help you figure out which one is best for you.
About the Author:
Christopher Q. Wintter is the founder of Wintter & Associates, P.A. and a board-certified expert in Trust and Estate matters by the Florida Bar. With more than 28 years’ experience as a practicing attorney, he also serves as an instructor and faculty member for the National Institute of Trial Advocacy (NITA)—the nation’s leading provider of legal advocacy skills training to practicing attorneys—and has earned the AV® Preeminent™ rating with LexisNexis Martindale Hubbell. He was also selected for inclusion in Florida Super Lawyers for 2011, 2012, 2014-1016 in Estate and Trust Litigation, and was selected for inclusion to The Best Lawyers in America in 2016.