Here’s what we cover:
A deed is a legal document that transfers an interest in real estate to another person. Anyone who owns a house acquired title to it by a deed. Here we will see how real property can be transferred outside of probate by using a beneficiary deed.
A beneficiary deed conveys an interest in real property to another person, called the beneficiary, on the death of the property owner. The transfer is subject to all liens and encumbrances on the property at the time of the owner’s death. A beneficiary deed can be used by an owner of real property to transfer that property on his death outside of probate. A beneficiary deed may designate multiple beneficiaries and state how those beneficiaries will take title to the property.
If the property is owned by more than one person, all of the owners should sign the beneficiary deed. If the property is owned as joint tenants with the right of survivorship or as community property with the right of survivorship, and all of the owners execute the beneficiary deed, the deed is effective on the death of the last surviving owner. (Special rules apply if less than all of the owners sign the beneficiary deed.)
A beneficiary deed is valid only if it is executed and recorded as provided by law in the office of the county recorder in the county in which the property is located, before the death of the owner or the last surviving owner.
The chief characteristic of a beneficiary deed is that the transfer of the owner’s interest in the property is not effective until the owner’s death. Thus, the beneficiary does not acquire any interest in the property during the owner’s lifetime.
A beneficiary deed may be revoked at any time by the owner or owners who executed it. To be effective, the revocation must be executed and recorded in the county recorder’s office before the death of the owner or the last surviving owner, if there are survivorship rights. A beneficiary deed cannot be revoked by the provisions of a will.
Because a beneficiary deed may be used to avoid probate, it should be considered as part of any comprehensive estate plan.
The above article is an excerpt from Estate Planning in Arizona: What You Need to Know, 2nd Edition (Wheatmark, 2019), by Donald A. Loose, republished with the author’s permission.
Disclaimer: Laws change constantly. Specific legal advice should be obtained regarding any legal matter. The information contained on this website does not constitute legal advice and no attorney-client relationship is created.
Donald A. Loose is an Arizona attorney, and the author of Arizona Laws 101: A Handbook for Non-Lawyers, and Estate Planning in Arizona: What You Need to Know. Mr. Loose is a regular guest on radio shows featuring local newsmaker interviews. He may be contacted at firstname.lastname@example.org.
7 Reasons to Update Your Estate Plan/in Estate Planning/by Don Loose
Your estate plan is not a “set-and-forget” kind of strategy. There are certain life events and circumstances that warrant your updating this important set of documents.
Why You Need an Estate Plan/in Estate Planning, Wills & Trusts/by Leighten Hendrickson
Planning for our own death is not something that tends to thrill most of us. It is difficult to face our own mortality.
What is Estate Planning?/in Estate Planning/by Michael Ruppert
What comes to mind when you see the words estate planning?
Informal Probate – Administration of Estates Outside of Court/in Estate Planning/by Don Loose
In many cases, probate is a quick and efficient way to transfer the assets of a person who has died (the “decedent”) to his heirs. About 10,000 probate cases are filed each year in the state of Arizona.
Special Purpose Trusts – 2 Most Common Forms/in Estate Planning/by Don Loose
A trust is a legal entity that is created and holds title to assets during the life of the person who places assets inside the trust