Ladybird deeds are a rather unique and effective estate planning tool when it comes to transferring real property -- one that isn't available in all states. However, they are commonly used in Michigan.
Here are some of the biggest benefits Ladybird deeds have:
1. They're easy and inexpensive
Good estate planning means cost-effective estate planning, and Ladybird deeds are an inexpensive, easy way to pass your home or land to your heirs.
A Ladybird deed essentially sets up your heir as the beneficiary of your property -- which then transfers to his or her ownership immediately upon your death, bypassing probate. Once drafted, the deed is signed and merely recorded at the local register. The cost to you is minimal in terms of what it takes an estate planning attorney to do to make sure the deed is prepared and executed properly.
2. They don't carry a lot of risks
Unlike other methods people sometimes use to make sure that their children inherit the family home or land, Ladybird deeds carry little risk because you retain full ownership of the property until your death and can revoke the deed at any time.
For example, if you put your son's name on your home intending for him to inherit, he gains ownership interest. Imagine that he then gets divorced -- and his spouse now wants her share of your home! All of that mess can be avoided with a Ladybird deed.
3. They can help with Medicaid Recovery
If you receive Medicaid benefits prior to your death (which often happens if someone enters a nursing home), the state can put a claim on your estate. Keeping your property out of probate safeguards what you have from the state -- and keeps your family home in the family.
For more information on whether or not a Ladybird deed is right for you, schedule a visit with our office to talk about your estate planning strategy.