Even for those that don’t know the ins and outs of the
probate process, most people know enough that they would like to avoid probate
because of the time and money it requires. There are several ways to avoid probate altogether but the
beneficiary deed is a very simple method of allowing real property to be
transferred without the court’s supervision.
A
beneficiary deed is a deed that transfers an owner’s interest in real property at
the death of the owner.[1] Unlike other types of deeds, the
beneficiary deed must be filed during the owner’s lifetime and does not involve
any type of exchange of value between the owner and beneficiary. However, the process and
procedures for filing a beneficiary deed are similar to filing any other type
of real property deed and should be filed at the circuit clerk’s office in the
county where the real property is situated. Additionally,
a beneficiary deed can be revoked during the owner’s lifetime.
Although
this is a very simple and cost effective method of transferring property, a
beneficiary deed does have its limits.
When an owner passes away, the beneficiary of the real property still
receives the property subject to any mortgages, liens, or other encumbrances
that may be in existence at the time of the owner’s death. Moreover, the Department of Human
Services may be able to make a claim against the real property transferred to
recover certain types of aid received by the owner or beneficiary.[2]
There
are minority of other states that allow this type of deed including the
surrounding states of Missouri[3]
and Oklahoma[4]. So if you own property in Arkansas or
any of the other states who allow beneficiary deeds and you want that property
to transfer at your death without court supervision, you might think about
filing a beneficiary deed. By
doing this, your real property will automatically be taken out of your estate
and avoid the long and costly process of probate.
