Lady bird deed - Legal doc for conveying property to heirs

Jessica
Author:
Community Mentor
Rate This Article:
(Rated 4.7 by 5032 viewers)



A quit claim deed is a legal document which transfers your ownership interest in a property to another party. The property may include home, land or mobile home. The person who transfers the property is called the grantor and the person to whom the property is transferred is called the grantee. This mortgage tool is used by spouses, friends and relatives.

Here it is to be noted that credit score has nothing to do with a property transfer through a quit claim deed. The person to whom the property is transferred may have good or bad credit. If you property is free and clear, it does not affect the grantee who has bad credit. However, if some unpaid mortgages are attached to the property, then it negatively affects the grantee. And, if the grantee has already bad credit situation, then he/she faces serious problems in repaying the loan. Anyways, once the property gets transferred, the grantee becomes responsible for paying property taxes.


Last updated on August 25, 2014

Latest Community Discussions
If my mom is already in a care home can we still apply for the ladybird? And can Medicade take her property if they are helping take ca...

posted on 2014-08-21 11:38:16
I retained a lawyer, in the state of Texas, to protect my mothers homestead from Medicaid reimbusement in case she had to go to a rest ...

posted on 2014-06-23 19:38:41
My uncle had Medical Power of Attorney, while my Grandmother was alive, they issued the LBJohnson Deed naming him the Grantee. She pas...

posted on 2014-04-24 21:06:41
im on a ladybird deed its my moms house do I have to report it to DHS and if so will it hurt my Medicaid or my moms medicare or her med...

posted on 2014-01-21 21:06:49
if you are on a ladybird deed and on dhs do you have to turn it in as a trust and if you do will it hurt the person that is giving you ...

posted on 2014-01-20 22:15:23





Ask question to Author
Subject
Image Verification


Can't read the image? click here to refresh
Message body
Author Message
jholzer


Guest




Post     Post subject: Lady bird deed – Legal doc for conveying property to heirs

I have heard that lady bird deed can be used to avoid probate but not aware of the actual procedure for it. please help
Mini Profile  colin

colin
Moderator

Joined: 30 Jun 2006
Posts: 582
Location: Waltham, Massachusetts
112.65 Dollars($)
Post     Post subject:

Hi Jholzer,

Welcome to Mortgagefit forum.

Ladybird deed or Enhanced life estate deed can be used to avoid probate procedure.

Let me explain how it works.

Owner(s)/grantor(s) of the house make a deed and name his beneficiaries as grantee(s). With such a deed the person retains a life estate upon the property with the right to sell the said property any time he likes. By making the deed:
  • Ownership remains with the grantors,
  • The grantors retains the right to revoke the deed at any time and
  • If the property is not sold during the lifetime of the grantors, then it passes on to the named grantees without the need for a probate after the death of the last grantor.
Let me know if you have any other question about this type of deed.

Colin
Mini Profile  carnahandavid

carnahandavid


Joined: 21 Dec 2006
Posts: 238

58.41 Dollars($)
Post     Post subject:

Hi Jholzer,

I have some information on why it is called "Ladybird Deed".

President Lyndon B. Johnson once used this deed to transfer property in his wifes name, "Lady Bird" Johnson. Henceforth, this deed got recognized by her name.

David
jholzer


Guest




Post     Post subject:

Thanks for the information, so is there any difference between ladybird and a regular life estate deed?
Mini Profile  blue

blue


Joined: 21 Oct 2005
Posts: 1130
Location: MARYLAND
137.76 Dollars($)
Post     Post subject:

Hi Jholzer,

Welcome back.

In a regular life estate deed, the owner of the property retains a life estate and continues to use the property during his life time. But he cannot sell the property without the agreement & participation of the named beneficiary.

Whereas in Ladybird deed the owner retains his sole right of selling the property, giving it to any other person or change the title without requiring consent from the beneficiary.

Thanks
Blue
Bill Slawski


Guest




Post     Post subject:

Another advantage of Ladybird deed is that the property is not subject to any liens that may arise against the named beneficiaries of the property.

It means that if there are judgment liens, tax liens or any other type of lien against the beneficiary, those liens will not get attached to the property.

B.S.
Mini Profile  Caron

Caron
Moderator

Joined: 19 Jul 2005
Posts: 1516
Location: florida
279.74 Dollars($)
Post     Post subject: where ladybird deed is applicable

Florida, Texas, Ohio, California, Kansas are some of the states where ladybird deed is applicable. It acts an alternative option to traditional life estate deed.

However, the deed is not used in cases where a life estate can result in too much of capital gains taxation. In such cases, a living trust can be used.

_________________
Mortgage Shopping made easy with booklet
drj


Guest




Post     Post subject: Lady Bird Deed

My mother is a widow and she is wondering if a Lady Bird Deed would protect her house from having to be sold to pay for a nursing home should she ever end up being in one.
Mini Profile  adonis

adonis


Joined: 22 Oct 2005
Posts: 12177
Location: ALASKA
1313.62 Dollars($)
Post     Post subject:

Welcome Drj,

Your mother can protect her house being sold off by using the ladybird deed. This type of deed helps the grantor to retain ownership of property throughout his lifetime with the right to sell it whenever required. The grantee or the beneficiary can only sell the property after the grantor's death.

_________________
Procrastination is the enemy of your financial success
Sammy


Guest




Post     Post subject: Lady Bird Deed Question -verses Quit Claim Deed

My father (widowed) is in a nursing home and is applying for medicaid. His only asset is his home. I was told that he needs a Lady Bird Deed to protect his home from being taken by medicaid for nursing home charges. My sister is trying to quit claim the deed with the following wording: Frank Trico, a single person, 1st party to, Carol Frank, a single person and not as tenant in common, reserving unto Grantor a life estate, without any liability for waste, second party whose post office is 8888 second st...Orlando, FL
Witnesseth, that the said first party, for and in consideration of Ten and No/100 dollars by second party, the receipt whereof is hereby acknowleded, has remised, released and quit-claimed, and by these presents does remise, release and quit-claim unto the said party of the second part all the right, title, interest, claim and demand which the said first party has in and to the following decribed lot, piece, or parcel of land , situate, lying and being in the County of........
To me this is a Quit Claim Deed and she is not following the Lady Bird rules.....please help. Thank you.
Mini Profile  colin

colin
Moderator

Joined: 30 Jun 2006
Posts: 582
Location: Waltham, Massachusetts
112.65 Dollars($)
Post     Post subject:

Hi Sammy,

Welcome to Mortgagefit forum.

Your sister is making a quit claim deed with your father named as the grantor who will have a life estate meaning until his death he will have ownership rights but will not have the right to sell the home. While if a lady bird deed is used then he will retain his right to sell the home any time he wishes.

In your situation a quit claim deed will also serve the purpose of saving the home from being taken to pay for nursing home charges. The reason is that after home is quit claimed it will not remain his property and any claim cannot be placed against property which is not part of his assets.

Colin
Ryan


Guest




Post     Post subject:

Yes, it seems to be a quitclaim deed with a life estate clause attached to it. It's not a ladybird deed. But I agree with Colin. A quitclaim can also serve your purpose here.

If the house is quitclaimed to you, it will prevent Medicaid from putting a lien on it for up to the full value of the assistance provided to your father.
Mini Profile  Caron

Caron
Moderator

Joined: 19 Jul 2005
Posts: 1516
Location: florida
279.74 Dollars($)
Post     Post subject: RE: ladybird deed and medicaid

Hi Sammy,

I think a quitclaim deed won't be applicable here. This is because when you quitclaim/transfer property for less than fair market value, the grantor becomes ineligible for the Medicaid benefits for as long as 5 years after the date when the transfer took place. However, the time period for ineligibility of the Medicaid benefits may vary from state to state.

In my opinion, a ladybird deed or enhanced life estate deed will be helpful. Such a deed would allow your father to retain his property which can be exempted from Medicaid claims in his lifetime. Also, the heirs or the beneficiaries can get the property after the death of your father and the home will still be free of Medicaid claims and liens.

I shall suggest that you consult an attorney and ask him to draft a ladybird deed based on the trems and conditions that will be helpful for you to inherit the property free of medicaid claims.

Good luck!!

_________________
Mortgage Shopping made easy with booklet
Alex


Guest




Post     Post subject:

First of all, I would like to know about the state where you reside as the laws on Medicaid may vary from state to state.

I can inform you about laws in Florida. You can then check if the same laws apply in your state.

In Florida, a person applying for Medicaid benefits can protect his/her home from the creditors and lenders under the following circumstances.
  • A spouse or dependent relative of the Medicaid applicant resides in the house.

  • The applicant or his representative states on his/her behalf that he would return home after utilizing the Medicaid benefits.
If the above conditions are satisfied, the home will remain exempt from Medicaid claims throughout the life of the applicant. Also, it will not be subjected to such claims after the death of the applicant in spite of a surviving spouse or heir or a dependent (who depends on the applicant) staying at home.

However, if there is no spouse or dependent or a heir, then the property can be used to satisfy the Medicaid claims.

Hope this is helpful
Guest







Post     Post subject: lady bird deeds- texas

BE CAREFUL doing either lady bird deed or quitclaim deed- although, they protect you under medicaid estate recovery - they do not protect for transfer penalties!! which could result in years of private pay at the nursing facility before medicaid ever kicks in
_________________
Need help choosing the right loan? Get free consultation from community lenders/consultant
1, 2, 3, ... 15, 16, 17  Next  
Page 1 of 17

 

Page loaded in 2.055 seconds.