Thinking about adding somebody to your deed? Here are a few things to think about.

The St. Ambrose Legal Services Department often receives calls from Marylanders who have been advised to add a relative’s name to the deed for their house. It is a common misconception that this is the only way to ensure that a house passes to a family member after the owner’s death. In fact, there are several more ways to ensure that your loved ones receive your home after you pass away.

At St. Ambrose, we help clients prepare three different documents that help secure clients’ property for the next generation. Take a look below for an explanation of these documents and their benefits and risks.

1. Will

The simplest way to ensure that your house transfers to your family members after you die is to write a will. The will specifies who is to receive your home after you pass away – it can be one person or multiple people.

Benefits: Writing a will is a quick, easy way to make your estate plans legally binding. Will appointments at St. Ambrose are free and they typically take less than an hour. Wills also cover other property like your physical possessions (cars, clothing, jewelry, etc.) and money in your bank accounts.

Drawbacks: After you pass away, somebody will have to open an estate on your behalf. An estate is the legal entity that represents a person who has passed away. Your family members may have to pay money to open your estate after you pass away. Additionally, if you die owing debt (credit card debt, medical debt, etc.), those creditors may file a claim into your estate. All claimed debts that are allowed by the Orphans’ Court must be settled before any assets, like your house, can be given to the person or people that you designated to receive them in your will.

2. Joint Tenancy Deed

You can also have a deed prepared where you add one or more people as “joint tenants with the right of survivorship.” This means that once the deed is filed, you become a co-owner of the property along with whoever else you have added.

Benefits: This ensures that whoever you have added to the deed remains an owner of the property after you have passed away. There is no need for anybody to open an estate for your co-owners to retain ownership of the property. If you pass away owing any debts, your creditors will not be able to place a new lien on your property after you die.

Drawbacks: You lose a certain amount of control over your property by filing this kind of deed. If you want to sell the property and a co-owner does not agree, you will not be able to sell without filing a lawsuit. Also, if a co-owner gets sued and loses, a lien could be placed on your property and you could be forced to sell it even if you are alive and living in the property. You will also have to pay fees to your local jurisdiction to record a deed.

3. Life Estate Deed with Powers

This is a special kind of deed that allows you to keep your ownership of the property during your lifetime and specifies a person or people who automatically receive the property after you pass away – these people are called “remainders.”

Benefits: After filing a life estate deed with powers, you keep full ownership of your property during your lifetime. This means that you can sell it, take out a loan on it, refinance a loan on it, or anything else that you were already able to do with the property. If you still own the property at the time you pass away, your remainder(s) automatically take title to the property after you die. There is no need to open an estate for the property to transfer ownership. If you pass away owing any debts, your creditors will not be able to place a new lien on your property after you die.

Drawbacks: You will have to pay fees to your local jurisdiction to record a life estate deed. Also, if you want to change who is the remainder on the deed, you will have to have a new deed prepared and recorded. If your remainder dies before you do and you do not change the life estate deed before you die, then your property will go to your remainder’s legal heirs.

If you would like any of these documents prepared for you or have any other estate planning questions, please call the Legal Services Department at St. Ambrose Housing Aid Center at 410-366-8500 extension 209.