Prescott AZ lawyer: Beneficiary deeds and much more!
Prescott AZ lawyer: Beneficiary deeds and much more!

Beneficiary Deed

In Arizona, Prescott AZ lawyers use a “beneficiary deed” to transfer ownership of property upon death of the grantor.  The beneficiary deed does not transfer any present ownership interest in the property and is revocable at any time by the grantor.  Accordingly, a beneficiary deed may be used to avoid probate.

There are, however, significant disadvantages to the use of a beneficiary deed. Joint owners (such as spouses) can defeat the purpose by revoking the deed after the death of the first joint owner.  Where there are multiple beneficiaries the interests will require assent of all of the owners to manage or deal with the property.  In these situations the possibility of conflict is increased.

Another disadvantage is that for estate tax purposes, the full value of the property remains in the owner’s estate.  Also, a beneficiary deed can result in significant expense and inconvenience if any of the beneficiaries are minors because a Conservatorship may be required to manage the minor’s interest.

A beneficiary deed should be used only when all of the relevant factors have been considered and determined.  Some of the relevant factors are: 1) whether the property is residential or commercial; 2) how many owners are involved; 3) when was the last title insurance policy obtained; 4) can a title insurance endorsement be obtained; 5) has the grantor made a valid Last Will; 6) has the grantor prepared a proper durable power of attorney; 7) what is the potential value of the grantor’s total estate; 8) what is the marital status of the grantor; how many beneficiaries are involved; 9) what is the relationship between the grantor and the beneficiary; and 10) are there any mortgages, liens or encumbrances on the property.

For assistance with an Arizona beneficiary deed, contact us.

Here is a link to the Arizona statute on beneficiary deeds.

Prescott, AZ lawyers - Probate, Quiet title, Wrongful death
Prescott AZ lawyer