The Will Says So!

More than once I have had a person tell me that he or she owns certain property “because the Will says so”. Some people have come to my office because they are trying to sell real property and the title company has told them that they do not own the property. They are very confused. The Will gave them the property! However, title to real property stays in the name of the deceased person unless the beneficiary has done something to transfer that property into his or her individual name. When you have a buyer waiting to purchase property, it is not a great time to find out you do not have title to the real property.

A Will does name beneficiaries who are to inherit property, but the Will does not convey title to property. Steps must be taken to administer the Will; to collect and transfer property to beneficiaries as provided by the Will. These steps can vary depending upon what type of property is being gifted and how the deceased person held title to that property.

If the deceased person owned real property or personal property (like bank accounts, brokerage accounts or automobiles) and that property is titled only in the name of the deceased person, then either a probate proceeding or an affidavit process is necessary to transfer the title to a beneficiary. The type of process that is needed depends on the value of the property. It is important to research and understand these processes or to talk to a legal professional who can help you assess the circumstances and explain your options. Then you can determine the most efficient and economical way to proceed.

Sometimes when a person signs a Will they also set up beneficiary designations on property so that the property can transfer directly to a beneficiary on the owner’s death without the need for a formal process. A few methods that can pass property without a court process include:

• Beneficiary Deeds: these deeds name a beneficiary or beneficiaries who will inherit real property when the owner dies. Upon the death of the owner the beneficiary must record an Affidavit with a death certificate which is evidence that the owner died and the beneficiary is the new owner.

• POD Accounts: these are bank accounts that name a beneficiary or beneficiaries who are to received the funds left in a bank account after the owner of the account dies. Upon the death of the owner the beneficiary only needs to present the bank with a death certificate and the bank will release the funds to the beneficiary.

• JTRS: this designation is a Joint Tenancy with Right of Survivorship. It can be seen on some real property titles and on some contracts. This property also passes to the surviving person(s) listed on the title or accounts. If it is real property, the survivor(s) must record an Affidavit with a death certificate which is evidence that one of the tenants died and the survivor(s) is/are the sole owner.

• Designated Beneficiary: this designation is common on life insurance policies and retirement accounts such as (IRA’s). Upon the death of the owner the beneficiary only needs to notify the insurance company or other institution regarding the owner’s death; that institution will verify the beneficiary designation and provide the beneficiary with paperwork to complete and return to them with a death certificate; the institution will then pay funds to the beneficiary or transfer an account into the beneficiary’s name.

More information about transferring certain types of property interests after the owner has died that do not involve a court process can be found at the AZ Legal Form Library, an interactive library provided by Cautela Corporation.

Do not just read a Will and make assumptions! Make sure you look at paperwork or deed documents on the property that is gifted under a Will, make appropriate inquiries and take the steps necessary to make sure title is transferred. Talk to a legal professional when you need to and be sure everything is done correctly.