Your family home is probably one of your most valuable and expensive assets. There is also an aspect of sentimental value, especially if your children grew up there. Plus, real estate has gone up dramatically in value, so the home could be worth a significant amount to your beneficiaries—even if their plan is just to sell it and get their money out of it.
There are a few different ways that you can leave real estate to a beneficiary. You could put it in a will, or you could transfer the real estate into a trust. Some people use joint ownership before they pass away, meaning that the beneficiary automatically takes over as the new owner of the home when the previous owner dies. Everyone’s situation is unique, so it’s important to know what options you have.
It could lead to conflicts
One thing to know is that leaving a home to multiple beneficiaries could lead to conflict between them in the future. For instance, say that you have two adult children—one of whom is relatively well off and the other who has struggled financially. The first may already own a house, so they just want to sell the family home and they see it as a source of income. But the other person may not have a home and may have been renting, so they want to keep the house and live in it.
There are ways that this can be resolved. For instance, courts can sometimes order a partition action to split a property, allowing one person to sell their ownership while the other person retains theirs. But it makes things much more complex, and it increases the odds of estate disputes that could harm the beneficiaries’ relationship in the long term.
For all of these reasons, it’s very important to plan in advance when transferring real estate and other significant assets. Make sure you know about all of your legal options.
