Legal Question in Wills and Trusts in Oregon

Re: A Will

Yes, it will, but deeding the house to your daughters at this time could create other, possibly more significant, problems than probating a will, or even doing a probate without a will (intestate estate).

First, if you deed the house to your daughters, you will lose the right to get a reverse mortgage or use the senior citizen tax deferral program because of the additional (younger) people on the house.

Second, you cannot get a mortgage or sell the house without your daughters' cooperation (and without a mortgage company looking at your daughters' credit as well). Further, they could have the right to force you to sell the house or buy out their interests through a partition suit, whether you want to or not.

Third, by giving the house to them now, they lose the right to get a step up in basis for capital gains tax purposes, which means that they could have a significant tax liability when they sell the house after you are gone.

Fourth, your house could become subject to their debts and obligations. For example, if one of them is in an uninsured accident, or is sued and loses, the creditor could come after your house.

Finally, making this gift to them at this time could result in as much as a five year ineligibility for Medicaid (which pays for nursing home care for folks who cannot afford it and who have significant physical or mental problems).

There are other issues as well that come into play when considering deeding a house to children.

For all of these reasons, our office typically recommends that a will and probate are far better ways to deal with inheritance than current deeding.

Before making such a deed you should consult with an attorney to make sure that you are fully informed of all the implications of such an action.