A life estate creates a form of joint ownership between you and your intended beneficiary. It is sometimes used as an alternative to a will.
While choosing to create a life estate as part of your estate plan can be an effective means of avoiding probate, using this approach can have both “pros” and “cons”. These things should be carefully considered before choosing this
method as an alternative to a will. If not, the result could have a long-lasting, even irreversible, consequences on you or your loved ones.
Do you know which of these are the cons and which are the pros to creating a life estate?
Effect of Remainderman’s Financial problems
Impact on getting a mortgage
Capital gains tax on sale of property
Qualifying for property tax exemptions
Remainderman dying before life tenant
We do, and it is all in this FREE 10 page guide. Find out if a life estate is right for you and your beneficiaries.
Pros and Cons of Life Estates
What is a Life Estate?
A life estate is a form of joint ownership in which one person (the life tenant) has the right to occupy real estate and other person (the remainderman) who fully owns the property at the life tenant’s passing.
Who can Create a Life Estate?
The current owner of real estate can create a life estate for themselves or another person.