A will is essential to ensure that your assets, including real estate, are distributed according to your wishes after your passing. But even minor mistakes could result in issues and difficulties for your loved ones. At Sorensen Smith LLP, our estate lawyers in Chilliwack are experts in drafting wills and estate planning specific to your needs. There are five common pitfalls to avoid when you include real estate in your will.
Failing to Identify Real Estate Assets
A common error is not providing precise information about real estate properties. Just stating “my house” without including an official description of the property or address can confuse the beneficiaries. Inconsistencies like this can result in disputes or difficulties when distributing your assets.
What to do
Get an experienced lawyer to include specific descriptions of your real estate assets including the the property’s legal description and address. At Sorensen Smith LLP, we ensure that every detail is documented to prevent misinterpretation. Our team is always up-to-date on legal developments affecting real estate to give accurate and up-to-date advice.
Ignoring Jointly Owned Properties
Under joint tenancy, the right of survivorship applies. This means that when one joint tenant passes away, their share of the property automatically transfers to the surviving joint tenant(s), regardless of what the deceased’s will states. This legal principle ensures that jointly held property does not form part of the deceased’s estate and cannot be distributed under the terms of the will.
However, it’s important to note that:
- The right of survivorship applies only if the property is held in joint tenancy. If the ownership is tenancy in common, each owner’s share does not automatically pass to the other and can be distributed according to their will.
- Disputes may arise if the surviving joint tenant is challenged (e.g., by other beneficiaries in the will), particularly if there is a claim that the property was not intended to be jointly owned in this way.
How to Avoid It:
Find out how your property is named and be aware of how joint ownership can affect your property. The attorneys in Chilliwack can assist you on how to align your property titles with your estate plan objectives.
Failing to Update Your Will After Real Estate Transactions
Failing to update your will after purchasing, selling, or transferring property can create confusion over your intentions. For instance, selling one of the properties mentioned in your will without making revisions may leave the beneficiary uncertain of their inheritance. Your will must reflect your current assets to avoid miscommunication between beneficiaries and heirs.
How to Avoid It:
Be sure to check and revise your will every time you make a major real property deal. Regular updates will ensure that your intentions are transparent and enforceable. The attorneys for estates in Chilliwack can assist you in integrating changes seamlessly in estate planning.
Overlooking Mortgages and Liens on Properties
Transferring a property with outstanding debts, like mortgages or liens, could result in financial burdens for the recipient. They may be required to pay the debt, which could lead to the selling or foreclosure of their property.
How to Avoid It:
Make it clear in your will how debts on property should be dealt with. For example, you could instruct the estate to pay any outstanding loans before the transfer. Legal experts from our team supported by our expertise in legal issues about real property can assist you to make these decisions to safeguard your beneficiaries.
Neglecting Tax Implications
Real estate typically comes with tax implications, such as capital gains tax and probate costs. If you don’t plan for these costs, they could reduce the worth of your estate and put financial stress on your loved ones.
How to Avoid It:
Talk to a financial adviser along with an estate planning attorney to create strategies to minimize tax burdens. This may involve setting up trusts, or the sale of assets over your life. Sorensen Smith LLP, a known lawyers office in Chilliwack, is a reputable name among attorneys in Chilliwack. We can partner with financial experts to develop complete plans to protect your estate.
To Conclude
Real estate is among the most valuable assets of an estate, any mishandling could lead to expensive legal issues. At Sorensen Smith LLP, our estate lawyers in Chilliwack are experts in estate planning and will ensure that your wishes are respected and that those you love are secured.
If you’re required to draft a new will, modify one you already have, or are looking at ways to manage your real estate portfolio, our expert team is always up to date with the most recent information regarding real estate law. We can offer the most effective solutions for your requirements.