One of the many advantages of putting an estate plan in place is that you can take steps to minimize the effects of the probate process for your loved ones after you’re gone. This can help them avoid the time, work and expense that probate can entail and enable your assets to reach your intended beneficiaries more quickly.
If you’re a homeowner, there are multiple options under Pennsylvania law for keeping your home out of probate. The following are among the most common.
Revocable living trust
Revocable living trusts are a popular option for avoiding probate – especially for titled assets like homes. When you place your home in your trust, you still have full control of it as the trustee (including the ability to sell it). When you pass away, your successor trustee disburses of the home and other assets in the trust as you designate.
You can stipulate that the home be sold and how the proceeds will be distributed (for example, divided equally among your adult children or to one specific beneficiary). If one of your children would like to inherit the home, you can designate that it go to them. By avoiding probate, the transfer can be relatively simple.
Joint tenancy with right of survivorship
If you’re leaving your home to a specific beneficiary, you can make them a joint tenant with right of survivorship (JTWROS) along with yourself at any time. If the home is owned this way, when one of you passes away, the other one automatically becomes the sole owner.
As JTWROS, one owner can’t sell the property without the other’s consent. However, you risk the possibility of a lien being placed on the property if the joint owner ends up having serious debt or legal issues.
Life estate deed
A life estate deed in Pennsylvania is similar to a transfer-on-death (TOD) deed in other states. (Pennsylvania doesn’t have TOD deeds.) This would automatically transfer the home to your designated beneficiary upon your death, but they would have no ownership rights while you’re alive.
Preparing your estate to transfer easily and privately to your loved ones, with minimal court involvement, is an important gift you can leave them. Getting experienced estate planning guidance is a good way to start.