The lady bird deed, also known as enhanced life estate deed, is a legal process of transferring real property to a named beneficiary, called a remainder, and avoids probate. As the current property owner also called the life tenant and grantor, you will still maintain full control and use of the property during your lifetime.
The major differentiating factor of the lady bird deed compared to others is the enhanced life estate. Because the life estate is enhanced, the life tenant retains all rights and authority to convey, lease, sell, mortgage, and even dispose of the property without needing permission from the remainder beneficiary. The remainder beneficiary has no ownership interest in the property during the lifetime of the life tenant. Upon the passing of the life tenant, the property automatically transfers to the remainder beneficiary avoiding probate.
Another advantage of the lady bird deed is that it is revocable, which means that the property owner can change or cancel the deed without restrictions. The property owner also maintains their Florida homestead exemption. In essence, the lady bird deed is an inexpensive and relatively simple way to transfer property compared to setting up a trust.
In considering the advantages, it is important to analyze some of the disadvantages. For example, the lady bird deed does not offer asset protection if the property is not the homestead of the owner, a creditor can still place a lien on the property.
In preparing a lady bird deed it is critical that the deed contains all the elements and language to be valid in Florida. We highly recommend that you speak to an attorney regarding your specific circumstances. Our firm specializes in estate planning and will be able to guide you properly.
