Is it difficult to sell a property if it has been subject to a Life Estate Deed? If all the parties are in agreement (life tenant and remaindermen), is there any advantage between a Life Estate Deed and a Lady Bird Deed or viceversa? Besides retaining individual rights to sell, mortgage, etc., what other practical advantages does a Lady Bird Deed offer?
With a Lady Bird deed, if the grantor decides to sell the property during theirlifetime, they are able to do so without the consent of the remaindermen/grantees. That is the main difference between Lady Bird deeds (also called enhanced Life Estate deeds) and simple Life Estate deeds. With a simple Life Estate deed, the grantor will need the consent of the remaindermen/grantees before selling or mortgaging the property.
If both the life tenant and all of the remaindermen are in agreement there is no problem with selling the property. All must join in the deed. If the life estate is an enhanced life estate (lady bird deed), and the sale is an arms length transaction to party unrelated to the seller or the remaindermen, the life tenant can sell the property without the joinder of the remaindermen. If you are unsure of your rights as a property owner, you should consult an experienced real estate lawyer in your area.
Disclaimer: This answer is provided for informational purposes only, does not constitute legal advice, and does not create an attorney-client relationship. Actual legal advice can only be provided after completing a comprehensive consultation in which all of the relevant facts are discussed and reviewed.
An experienced attorney or title company should be able to handle this type of sale without much difficulty. If the property is owned in a traditional life estate, all the remaindermen and the life tenant must agree to the sale. A Lady Bird Deed negates the requirement that the remaindermen consent to the sale. It is primarily used as an estate planning tool and to qualify for Medicare.
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