When someone dies, their estate may consist of all kinds of property, such as financial accounts, life insurance, jewelry, baseball cards, stamp or coin collections, automobiles, 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 with the property.
Does the property have to go through probate? Can you sell the property? Can you start living on the property?
Below you’ll find information about how the probate process in Florida affects the transfer of real estate after death.
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 the property. Unfortunately, you may not have a whole lot of say – not at first, anyway.
If the property left to you was in the decedent’s name alone at the time of his or her death, then it will be subject to the probate process. (Real property titled in other ways will be discussed below.)
The next consideration is whether the property was the decedent’s homestead (the primary residence of a Florida resident.) There are two main characteristics of Florida homestead: restrictions on devise and protection from creditors. The homestead property is not subject to devise by Will if the decedent was survived by a spouse or minor child. Validly devised homestead, or homestead that descends via intestacy, is not subject to the claims of creditors.
If the decedent was not survived by a spouse or minor child and the property is devised to you by Will, the property will not lose its homestead status and will pass to you free of claims of the estate as long as you are one of the intestate heirs of the decedent. However, it may take several months for you to obtain clear title to the property. If the decedent’s homestead property was devised to you by Will and you are not an intestate heir of the decedent, then the property loses its status as homestead and will be subject to the claims of creditors. The personal representative may be forced to sell the property to pay creditors’ claims. However, you will be entitled to the net proceeds after the payment of creditors’ claims and expenses of administration.
If the decedent has not been dead for more than two (2) years, the personal representative must publish a Notice to Creditors which imposes a three-month period that must elapse before most courts will consider a Petition to Determine Homestead Status of Real Property. Keep in mind, that after two (2) years have elapsed since the date of death, creditors’ claims (that have not been filed) are barred.
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 and titled, 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, the surviving spouse becomes the sole owner and may do with the property as they wish.
Joint tenancy with Rights of Survivorship. Husbands and wives are not the only ones who can hold title like 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 to 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 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 (or enhanced life estate) Deeds. A Lady Bird deed essentially says that you own the real property for life and that you wish to give it to a specific person when you die. For example, if a widowed father owned a house and wanted to pass it on to his daughter free of the probate process, he can contact a Florida Probate Attorney to prepare a Lady Bird Deed. The named beneficiary simply has to file the death certificate in the public records and the son will automatically gain control of the property. For more information on Lady Bird Deeds, click here. (insert link to the Lady Bird Deed blog.)
Real estate can also be held in trusts, as well as other techniques which can be used 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 and your estate plan. If you are inheriting real estate through probate, seek the advice of Wintter Law who can protect your rights and guide you through the process.