As an estate-planning attorney, one of the most common concerns that clients have is what will happen to their house upon their death. Considering that, for many Americans, the largest asset that they own is their real estate, this is a valid concern that needs to be addressed in a client’s estate plan.
The real estate of an individual who dies will likely be subject to administration by the Probate Court unless proper mechanisms are in place to avoid such administration. In Ohio, two of the most popular of these mechanisms include the Survivorship Deed and the Transfer-On-Death Designation Affidavit.
In Ohio, a Survivorship Deed is used to convey title to real estate to two or more people as joint tenants with rights of survivorship. Upon the death of an owner, the property passes to the surviving owner(s). A Survivorship Deed is commonly utilized to convey property to spouses. In this scenario, when the first spouse dies, the second spouse becomes the sole owner of the real estate. The surviving spouse must execute a simple Affidavit of Survivorship to memorialize the transfer. The affidavit, along with the deceased spouse’s death certificate, will then be recorded with the County Recorder’s Office to officially document that the transfer took place.
Although Survivorship Deeds are common between spouses, this does not necessarily mean that an instrument deeding property to spouses is, in fact, a Survivorship Deed. Survivorship Deeds contain special language that enables the property to transfer to the surviving owner(s) upon the deceased owner’s death. In the absence of this language, the deceased owner’s share of the real estate will not automatically transfer to the surviving owner, and the share will almost certainly require Probate Court administration to be transferred out of the deceased owner’s name. Thus, it is important to know and understand how your real estate is deeded.
The Transfer-On-Death Designation Affidavit is another legal instrument used to avoid the Probate Court’s administration of real estate upon the property owner’s death. A Transfer-On-Death Designation Affidavit allows the owner of Ohio real estate to designate one or more beneficiaries of the property. Upon the death of the owner, the property will transfer to the beneficiaries, and thus will avoid probate administration. The beneficiaries will simply need to execute an Affidavit of Confirmation. This affidavit and the deceased owner’s death certificate can then be recorded with the County Recorder’s Office to finalize the transfer of the property.
During the life of the owner, the designated beneficiaries do not have any legal right to the real estate, and the owner is free to transfer or sell the real estate without the beneficiaries’ consent. The owner may also amend or revoke the Transfer-On-Death Designation Affidavit if they so choose.
After understanding the fundamentals of Survivorship Deeds and Transfer-On-Death Designation Affidavits, many clients wonder if they can execute a Transfer-On-Death Designation Affidavit for property that was conveyed to them using a Survivorship Deed. The answer is yes!
Individuals who own Ohio real estate conveyed jointly with survivorship rights can execute a subsequent Transfer-On-Death Designation Affidavit. This is most commonly seen when spouses who own property that was previously conveyed to them by a Survivorship Deed execute a Transfer-On-Death Designation Affidavit naming their children as beneficiaries. In this example, the property will pass to the surviving spouse upon the death of the first deceased spouse, and upon the death of the survivor, the property will pass to the children named in the Transfer-On-Death Designation Affidavit. With properly executed instruments, both transfers will occur without court administration.
If you own real estate, it is important that you understand how your property is currently deeded and what will happen to your real estate upon your death. If either of these do not meet your intent, you should consider executing estate planning documents and real estate instruments to reflect your current wishes.
*This information is not, nor is it intended to be, legal advice. If you are seeking legal advice, you should contact an attorney. This information is not intended to create, and receipt of it does not constitute, an attorney-client relationship. *