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We often have clients ask about whether or not it is a good idea to hold real estate with their children. People sometimes believe that placing their children’s names on their homes or other real estate can take the place of more established estate planning methods, thereby saving them money. As a general rule we do not recommend that property be held jointly by individuals other than husbands and wives. Jointly held property can expose the owners to several important risks that should be considered.

Here are some factors to consider before holding real estate jointly:

  1. Creditor protection: Adding your children’s names to the property exposes the children and the parents to the creditors of each.
  2. Estate planning: Adding your children’s names to the property can be a way to transfer ownership to them in the event of your death, but it may also have unintended liability consequences.
  3. Control and management: Once your children’s names are added to the property, they will have equal ownership rights, which may not align with your intentions for the property.
  4. Transferability: If you add your children’s names to the property, it may be more difficult for you to sell or transfer the property in the future without their consent.
  5. Future disputes: Adding your children’s names to the property can lead to potential disputes between them in the future, especially if the property is not properly managed or if there are disagreements over its use or sale.

Before making a decision, it’s important to carefully consider all of these factors and to seek the advice of a knowledgeable estate planning attorney who can help you understand the potential legal and financial implications.

We Can Help

The estate planning attorneys of Penzien & McBride, PLLC have been helping families and business owners with their estate planning needs for more than two decades. If you are looking for a compassionate professional that can help you through the estate planning process, conduct a review of your existing estate plan, or if you would like additional information about our services, give us a call at (586) 690-4400 or schedule an appointment to discuss your needs.