Generally speaking, it is a good idea to take nearly any action to help your heirs avoid probate. Probate can be very expensive, time-consuming and the public nature of it is off-putting for many.
Some homeowners are looking to put their children’s name on their deed in order for it to avoid probate. However, according to In Charge Debt Solutions, this is a very bad idea that can lead to you losing your property due to the financial situation of the person that you put on the deed.
How would this help avoid probate?
Most of the time, people who consider this want joint tenancy. The reason why joint tenancy helps property avoid probate is that if one party of the joint tenancy dies, then the right of survivorship kicks in. This means that the surviving person will receive the property without it having to go through probate.
Why is this a bad idea?
If you put somebody else on the deed to your home, that individual has just as much of a stake in the home as you do. For instance, if you put your child’s name on the deed to your home and your child has to declare Chapter 7 bankruptcy, your home will be at risk of liquidation.
Alternatively, if your child marries and goes through a divorce, putting their name on the deed means that your house becomes, in part, your child’s marital property. This potentially means that your child’s ex-spouse will own part of your house.
A better solution is to put the home in a revocable living trust if you wish it to avoid probate upon your death.