Estate Planning Frequently Asked Questions
What Is A Transfer on Death Instrument?
Just like you do with a life insurance policy or a bank account, you can set a beneficiary on your home. We do this by a Transfer on Death Instrument, which is recorded on to the title of your home.
When you die, your beneficiary (typically your kids) will then automatically become the owners of your home. If they wanted to, your kids could sell the home the day after you pass away. This way, the kids will not have to go through probate court. They will automatically become owners of the home with a Transfer on Death Instrument.
There are some downsides. If you name more than one kid as the beneficiary to your home, all your children must agree on how to handle your home. If they cannot agree on what to do with your home, they will have to go to Court. Another downside is that the Transfer on Death Instrument is part of the public record. with a little digging on the internet, creditors and/or divorcing spouses can find out that the home will be transferred to your kids upon your death.
We can help you figure out if a Transfer on Death Instrument is the best fit for you and your family. We would be glad to discuss further.