Life Estates and Beneficiary Deeds

[dawsonrd]

My question involves real estate located in the State of: Arizona

Both Life Estates and Beneficiary deeds transfer title to someone else but can they be used together.

The specific circumstance is that a lady who owns property wants to ensure she and her new husband have use of the property untill they both die and that it then goes to the woman's 3 children but not to the new husbands child.

A beneficiary deed would transfer the property to her children when she dies but does not ensure her husband a place to live till he dies.

Deeding the property to the children and creating a life estate would ensure they they couple could live on the property untill they die but removes the possibility of selling the property should she need to meet expenses.

Could she redeed the property to herself and create a life estate for her husband while at the same time executing a beneficiary deed giving the property to her children when she dies.

I guess the question becomes: Can a remainderman create a beneficiary deed in Arizona and can the person holding the life estate continue to reside in the dwelling even after the remainder man dies?

[dawsonrd]

Is it legal to make a beneficiary deed that names the ladies children as beneficiaries but that also creates a life estate for the husband?

[jk]

Is it legal to make a beneficiary deed that names the ladies children as beneficiaries but that also creates a life estate for the husband?

To the first question:

I think you are trying to cause the collapse of the universe. So far, it looks like you have designed an infinite loop that will collapse at the lady's death.

to this last question;

I do not believe so but not sure.

what about a joint life estate with the chosen kids as remaindermen?

[dawsonrd]

I too decided first thing was an endless loop. That is why I added the last. Locally, I have a couple of opinions as to the Beneficiary deed idea. All from attorneys. You know the saying. Ask 5 attorneys for an opinion and you will get 6 opinions.

The lady wants to be able to sell the property if needed. That is the reason to not deed it to the kids with her and her new husband having life estates.

[jk]

If she writes a life estate for the husband with the kids as remaindermen, she simply loses the possibility of selling the house at all. A deed with remaindermen transfers title to the remaindermen upon execution. It isn't a possessory interest due to the life estate but it is still an ownership interest.

Why can't she simply direct in her will the transfer to the husband a life estate and the chosen children as remaindermen? That way, she maintains her current ownership interest until her death. Her husband would gain the life estate and the chosen children would get the remainder.

the possible problem (which I have not researched to determine if it is a concern) is the possibility of a spouses right of claim to the homestead at her passing, or even some particular percentage of it. That would toss a wrench into title being able to be passed as I suggested if the husband elected to claim that interest.

another problem is; if her estate is insolvent, the house may need to be sold to satisfy estate debts.

I am not very familiar with trusts. She might look into what a trust might be able to do for her.