by Anita Schnee, Attorney at Law
Generosity can go awry despite the best of intentions. Husband and Wife lived frugally, childless but happy, in their little house by a lake. Then Husband fell seriously ill. Nurse, out of friendship, cared for Husband in his final days. In gratitude, the couple wanted to give Nurse a share in their home. The plan was that Nurse would inherit the house after both Husband and Wife passed. The couple gave Nurse a “joint tenancy with right of survivorship” (JTWROS).
After Husband died, Wife continued to live in the home. All was well until Wife re-married and her new husband moved in. Nurse complained to a lawyer, who told her that as a joint tenant, she had the right to immediate co-possession. Nurse then demanded to come in the house and use Wife’s laundry facilities. Wife’s lawyer, to Wife’s dismay, advised that JTWROS did indeed give Nurse the right to enter the house and even to live there with Wife, but that she could not use Wife’s appliances.
Wife took out a second mortgage and bought Nurse out.
Husband and Wife could have done better. They could have given Nurse a transfer-on-death, or beneficiary, deed. This kind of deed would stay dormant while both Husband and Wife were alive, but would automatically give Nurse the house when the last of the couple died. Alternatively, the couple could have kept a “life estate” for themselves until both died, at which point Nurse would also inherit without court proceedings.
Or, the couple could have bequeathed Nurse the house in a will. If house’s value were modest and the estate stayed small – in some states, under $100,000.00 – the couple’s property could be distributed in abbreviated proceedings. “Small-estate” or “summary” or “affidavit” proceedings, depending on the state, avoid the expense and delay ordinarily involved in probating larger estates.
Or, for those whose financial picture were more substantial or complex, putting the house in a trust might have been an available option.
In any case, each of these choices has its pros and cons. The wisest course would have been to consult a lawyer who is well-versed in elder-law issues. Simple gratitude turns out to be not so simple, when it comes to real-estate transactions.
* * *
Anita Schnee is an attorney licensed in Arkansas with the law firms of the Elder Law Practice of Cash and Whatley, and Mitch Cash Ltd.
* This article appears on sites for Mitch Cash Law, Ltd. and the Elder Law Practice of Cash and Whately.
Rights to this article are shared only with attorneys who are members of the Eldercounsel organization. For an attorney in your state, please click here.
