Beneficiary deed lawyer O’Fallon
A beneficiary deed is a type of real estate deed that is used in estate planning to ensure that your home or land avoids probate. Missouri statute section 461.025 authorizes the use of beneficiary deeds in the state of Missouri.
As of last year, 27 of the 50 states allow individuals to record beneficiary deeds for their property.
How Does A Beneficiary Deed Work?
A beneficiary deed lawyer O’Fallon, Missouri can draft the deed for you using the following information: who the grantors are (who owns the property now), who the grantees are and their addresses (who will receive the properties upon the death of the current owners) and the legal description of the property (the book and page where the original deed to the property can be found at the recorder’s office).
Once drafted and signed, a beneficiary deed must be recorded before you pass away. That’s a strict requirement in order for it to be effective.
Can I Name A Contingent Beneficiary In The Beneficiary Deed?
Yes you can. To be clear, a contingent beneficiary is someone who would inherit the property if your intended beneficiary predeceased you. As an example, Jane creates a beneficiary deed leaving her house to her son Jason, but if he has predeceased her then to her contingent beneficiary, her brother John. Naming a contingent beneficiary is not only allowed, but smart estate planning, because it takes into account possibilities, however remote, that your intended beneficiary dies before you. In the above example, if Jason did pass away but you didn’t have time to record a new beneficiary before you passed away, the property would become part of your estate. That might include an unintended beneficiary like a sister or a parent. As I like to remind clients, there is no extra cost or penalty for planning for the unexpected, so name contingent beneficiaries whenever possible.
What If I Buy A New House?
If you record a Missouri beneficiary deed for a property and then sell it later, that just means the beneficiary deed is invalid because you no longer own the property. However, assuming you bought a new property in Missouri, you’ll need a new beneficiary deed to be recorded in the county recorder’s office where the new property is located.
Do I Need A Missouri Revocable Trust To Create A Missouri Beneficiary Deed?
No. In fact, this is a terrific feature of a beneficiary deed because if your circumstances are that you don’t need a living trust and you know who you want to get your property when you pass away, you can create a beneficiary deed giving the property directly to those people when you pass away, instead of to a trust. In other words, you’ll still avoid probate by filing a probate deed, but without using the traditional method, by using a living trust to do so. On the other hand, you still avoid probate in the beneficiary deed if you do have a trust and leave the property to it instead.
If I Have A Beneficiary Deed, Do I Still Need Other Estate Planning Documents?
Yes, absolutely. Any wills and trust attorneys O’Fallon will tell you that the cornerstones of any estate plan are a will and/or a trust, a healthcare power of attorney, a living will and a financial power of attorney. The beneficiary deed is a handy tool but it does nothing more than provide a way to avoid probate with your home. A living trust and/or last will and testament may be necessary to dispose of other property such as bank accounts, vehicles, insurance policies, IRAs and 401K.
Additionally, power of attorney documents are necessary while you are living but are effective when you are no longer competent. In other words, a beneficiary deed has nothing to do with these documents.
What If I Want To Change My Beneficiaries?
That’s not a problem as long as you are competent to do so. So for example if you named your three children as beneficiaries and then decided to cut one of them out of the beneficiary deed, you would just have to create a new beneficiary deed with this change and record it. Recordation of a new Missouri beneficiary deed revokes the prior deed.
What Is The Process After I Pass Away But Have Recorded A Missouri Beneficiary Deed?
Your stated beneficiaries in the deed you recorded then have an equitable interest in the property, subject to any liens or mortgages. Just as with you, they only own what you owned when you passed away. If there is a mortgage, the mortgage will have to be paid off or re-financed and any other liens on the property, such as a tax lien, would have to be paid as well. Additionally, your survivors will have to record a document called an Affidavit of Death with the county recorder where the property is located. The document has specific requirements and its best to have an affidavit of death lawyer O’Fallon draft and record the document for you. Once this is done, the property (or at least the equity) will be in the name of the beneficiaries.
Can I Revoke My Beneficiary Deed In My Will?
Yes you can. RSMo. 461.033 states that you can revoke a recorded beneficiary deed through provisions in your will, so long as the beneficiary deed your seeking to revoke states that this can be done. To be clear, the cleanest and simpler way to revoke a beneficiary deed is by creating a new one. Remember, if you revoked your beneficiary deed through your will, the will would have to be probated in order to carry out the wishes in your will with respect to the property. So it’s not only not as simple, but it would be costlier too, because you’d have the expenses of probate added to transfer the property through the last will and testament.
NEED HELP WITH A MISSOURI BENEFICIARY DEED? Legacy Law Center can help! Call us today at (636) 887-5297.