Adding Family Members or Loved Ones to Your Deed – Pros and Cons

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There are two advantages to adding family members or loved ones to your deed.

Pro #1 – Avoid Probate

First, if you die, your house will instantly pass to the persons you’ve added.

This means that the property will not go through the probate process.

Avoiding probate will save a lot of time, money, and aggravation.

Pro #2 – MassHealth

Second, it can reduce the penalty you incur if you apply for MassHealth.

When you apply for MassHealth assistance with long-term care, you will need to disclose the value of your assets.

The more assets you own, the more you will be required to spend before the state will assist you.

When you add people to your deed, you lose a portion of ownership in your home.

This can substantially reduce the size of your estate and, consequently, make it easier for you to qualify for MassHealth.

If done properly, it can also prevent MassHealth from attaching liens on your property after you die.

Best for Single or Widowed Homeowners

So who would benefit most from these advantages?

Usually it’s a single or widowed homeowner who is about 70 or older.

Married homeowners hold title to their home jointly.

This means that if one dies, the other will instantly own the home in its entirety.

There’s no need for probate.

Furthermore, a married MassHealth applicant can usually transfer assets to a spouse without incurring penalties.

Single homeowners don’t have these advantages.

There are two disadvantages to adding people to your deed.

Con #1 – It Complicates Things

First, it will make dealing with the home more complicated.

The people you add to the deed will need to consent to everything you do with the property—sell it, mortgage it, lease it, etc.

If any of the new owners refuse to cooperate, you’ll need a court order to resolve the matter.

Con #2 – It Creates Liability

Second, it could make your real estate susceptible to the new owners’ creditors.

Say, for instance, that you add your son to your deed.

He then falls behind with his bills and his creditors take him to court.

If they win at court they can attach liens to any real estate he owns.

This could include your home.

So if you have a family member or loved one facing legal problems, you should think twice about adding that person to your deed.

Caveat – Always Consult an Attorney

It may seem simple to rewrite your deed and just add a few names to it.

But drafting deeds can be very technical.

Adding or omitting just a few words here or there can completely thwart whatever it is that you’re trying to accomplish.

Therefore, it’s important that you consult an attorney.

Most attorneys will charge anywhere from $100 to $500 to draft a deed.

You’ll also need to pay a $125 fee to record the document at the registry of deeds.

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