Most people hate to think about it, but the truth is once a person dies, any real estate property they own is left behind. So what happens to it?
When a person dies, any real estate they own is typically handled in one of two ways…it’s either transferred by a process called descent or by their will.
If you have a will in place, (which you should, especially if you own property), your house will usually go to whomever you leave it to in the will.
When a person dies and they don’t have a will, the state laws of descent take over. These laws set forth guidelines which determine who’s entitled to the estate of the person who died. Any real estate they owned is usually distributed to their heirs.
The typical order of descent is usually first to a spouse (if they were married), then to their children, parents, siblings, and then other family members down the line.
Every state has laws that govern what happens to real estate when the owner dies without a valid will so be sure to check with your individual state. However, generally, only spouses, registered domestic partners (in states where they are recognized), and blood relatives inherit under these laws. Unmarried partners, friends, baby mommas, boyfriends, and charities usually get nothing if you don’t have a will.
Important: If a person owns real estate and they don’t have a will and no relatives can be found, the state or another government entity will usually take the property.
So plain and simple, if you don’t want the government to end up with that $300,000 house you just bought, make sure you create a will.
If you and your boyfriend just bought a house and her name isn’t on the deed…if you expect her to get the house God forbid something were to happen to you tomorrow … you need a will.
In addition, all states have rules in place that prevent certain people from inheriting real estate in the event of your demise. For example, a person who causes the death of a deceased person is usually never allowed to profit from the death by inheriting real estate, life insurance benefits, etc. the deceased person might have owned.
If you’re an only child and your grandmother dies because you accidently run over her with your car…you probably won’t get the house.
These are just the laws. Laws you need to be aware of.
The bottom line: If you own real estate of any kind. I don’t care what kind it is. It could be a mobile home, a parking lot, condo, townhome, abandoned field or a boarded up house in the ghetto…make sure you have a will.
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Information posted in this column is given on an informational basis only and shouldn’t be taken as legal, tax, accounting, or financial advice. For specific guidance on any subject matter discussed in this column, please consult a professional in that respective field.