An Intro to the Ladybird Deed and When to Use it
Here is an Intro to the Ladybird Deed and when to use it
How the Ladybird Deed WorksStrictly speaking, a Ladybird Deed is not a distinct document from a regular Warranty Deed, Special Warranty Deed, or Quitclaim Deed. It contains most of the same language and components, such as a legal description of the property, the legal names of each party and their designation as either grantor or grantee, and so on.
What makes a deed a Ladybird Deed is the inclusion of language that states the following: the subject property is conveyed to one or more grantees called "remainder beneficiaries" or "remainder-men" upon your death, however until then, you have the right to sell, use, mortgage, and otherwise administer the property any way you wish during your lifetime without the consent of the remainder beneficiaries.
Only when you pass away does the property in the Ladybird Deed transfer to the remainder beneficiaries. All they must do is file your Death Certificate in the public records and the property will be transferred without the need for probate.
The Advantages of the Ladybird DeedAside from allowing your beneficiaries to circumvent probate, the Ladybird Deed has several other benefits. The reason it is sometimes called an Enhanced Life Estate Deed is because a regular Life Estate Deed does not permit the grantor to sell, transfer, or do anything else with the property without the consent of the remainder beneficiaries.
In other words, a Ladybird Deed gives you more flexibility and the chance to change your mind for any reason. You can continue using the property as a residence, convert it into an income property, sell it, or gift it to someone else (without getting hit with a federal gift tax). For as long as you live, the property is yours to do as you wish.