Mini-Expose on the New Revocable Transfer on Death Deed By Jennifer Sawday As of this year, California enacted a new revocable transfer on death deed, which was effective on January 1, 2016. This law allows a deed to transfer the title of a residential real property upon the homeowner’s death to another person as desired without probate or trust administration.  For those who Google, this section has been codified in the California Probate Code Section 5600, et seq. It is similar to payable-on-death accounts offered by banks and other financial companies. At first glance, it creates a relatively inexpensive way for Californians to transfer their real property after death without administration to the intended beneficiary.  The deed must be prepared, notarized, and recorded within 60 days of its execution to be valid. The person who is intended to receive the property must also survive the homeowner! Approximately half of the states already have laws providing some kind of revocable transfer death deed. This legislation was intended to follow that trend. These deeds may be used for residential properties with up to four units or a single tract of agricultural land that is 40 acres or less and improved with a single-family residence. The statute expires/sunsets on January 1, 2021, unless the Legislature acts otherwise. Any properly prepared and recorded deed under this law will remain valid despite the sunset clause. Even with the presumed benefits of avoiding the administration of real property with these deeds, it does not eliminate the need for proper estate planning.

• First, a recipient under this type of deed will be liable for the now-deceased homeowner’s debts (Medi-Cal payback, credit cards, and any other secured and unsecured debts). This may cause unintended consequences that could be avoided with proper planning.
• Second, the deed does not provide any means for someone to handle the personal, financial, or other affairs of the property owner who is alive but not well.
• Third, it does not meet the requirements for handling the disposition of remains.

Some of us might just think, “Great!! You can get the house.” However, there are serious unknowns about who is going to handle the mail, bury the body, and handle all of the other things that come with a life coming to an end! Email me if you want more information or wish to discuss this new law further. I am always happy to have a conversation: [email protected]. Jennifer Sawday is a partner at TLD Law. She is passionate about legal issues around estate planning, probate, revocable trusts, and trust administration post-death. Some of us know about writing a will, perhaps something you have saved on your computer or written on paper, but many laws will see your life savings wither once you pass away. You must learn how to protect yourself and correctly and legally protect your wealth and assets so that your children or spouse can benefit fully upon your passing. Most people know the words ” living trust ” and ” revocable living trust, ” and some see the word estate plan. Jennifer Sawday provides a free initial consultation to evaluate your case. New laws often trump old ones, and you must understand how they impact you and your family. Jennifer Sawday is a very personable and caring attorney. Find out how the new revocable trust law impacts you sooner rather than later.