I’m Buying My First Home. Is Now The Right Time To Be Doing Estate Planning?
When you are going through the process of buying your very first home, you may feel overwhelmed. You are making one of your first major purchases, spending a considerable sum of money, and you are signing so many documents that it may feel like you are signing each individual page of a phone book. Many people during this time do not want to complicate the matter further by adding estate planning into the mix, but it’s much simpler than people may believe, and making those extra steps provides both early protections and valuable savings.
For most people, estate planning is only something you do when you have significant assets to pass down. This is never more relevant than when you are purchasing real estate. Real estate functions in its own category of property and requires extra steps to transfer ownership than it does a piece of personal property, such as a TV or a piece of furniture.
When the owner of a home passes away, it is not as simple as another family member moving into the home of the decedent and claiming it as their own. A real estate property must be deeded between owners to effectuate the transfer of ownership. Having actual ownership through a deed and title of a home is vital when addressing utilities, real estate taxes, or trying to sell the home.
While it may not feel like purchasing a home is the best time to engage two different legal services, doing so can save you time, money, and ensure that your property is secure for your family in the event of an unexpected tragedy. The best way to secure your home is by opening a trust at the time you purchase your home. The best method for securing your estate at the time of your real estate purchase is to have a trust opened at the same time and have the property deeded to the trust rather than yourself.
A trust is a legal entity that you create during your life that holds your property on your behalf. When you pass away, the person in charge of the trust, your trustee, will be able to administer the trust assets without the need to open probate, as you would with a Will.
What this will mean is that when you purchase the home, instead of having the seller deed it to you, they would instead deed it directly to your trust. Your trust would own the home on your behalf, and you as the trust creator, will be able to pay all bills and function as the owner of the home. Upon your passing, your designated trustee will have full authority without the need for probate or court permission to deed your home to your desired recipient.
Creating a trust to hold your first real estate transaction is a worthwhile expenditure. You save on the costs of deeding it once to yourself and then again from you into your trust. Doing so also ensures that if anything unexpected happens to you, this brand-new property is secure and can easily be passed on to your family without much effort.
If you are going to be making a real estate purchase and wish to save money while simultaneously making early steps to protect your assets and get your plan for the future in order, please consider contacting the Law Office of Andrew Szocka P.C. at 815-455-8430 or email us at info@szocka.com. Our dedicated estate planning attorneys look forward to assisting you!