Life Estate Deed, Creditors and the Death of the Life Tenant

[Garth2023]

Jurisdiction

New York

Hello,
My aunt died in early February of this year. She held a Life Estate on her house, and I was listed as the remainderman on the deed. We filed the death certificate with the Town of Riverhead.
My aunt owes a large sum of money to the hospital she was in when she died; a sum of money much larger than all of her other assets. We have not recorded a new deed in the county clerk's office. Is the house at risk due to the money owed to the hospital? Should we record a new deed as soon as possible? I have attached a copy of the Life Estate deed with certain info removed.

Thank you,
Garth

 

[flyingron]

If the deed you said you didn't record is the one granting you the property subject to the life-estate, then you are in deep doodoo. Get it recorded ASAP. The nursing home can get a priortiy if they record before you. Second, if this was paid for my medicaid, there may still be some clawback depending on when the deed was executed.

 

[Garth2023]

If the deed you said you didn't record is the one granting you the property subject to the life-estate, then you are in deep doodoo. Get it recorded ASAP. The nursing home can get a priortiy if they record before you. Second, if this was paid for my medicaid, there may still be some clawback depending on when the deed was executed.

Thanks for your reply.

The deed that I attached is the one that grants the property to me through the Life Estate, and it was recorded in 2015. She did not have Medicaid coverage.
I wanted to know if I need to record a new deed that shows that I am the owner of the property and that there is no longer a life estate in effect. I basically wanted to know if there is anything wrong with the attached Life Estate deed that would cause one of her creditors to go after the house now.

 

[zddoodah]

I was listed as the remainderman on the deed. We filed the death certificate

Why did you jump from "I" to "We" here? Who are "we"?

a sum of money much larger than all of her other assets.

Other than what?

Is the house at risk due to the money owed to the hospital?

No reason to think it would be.

Should we record a new deed as soon as possible?

I think you ought to consult with a local attorney to make sure all processes are done correctly. I can think of no reason for urgency. Nor can I think of any good reason for recording a "new deed" (unless you have an unexpressed interest in transferring title to someone else).

 

[Garth2023]

Why did you jump from "I" to "We" here? Who are "we"?
****I included my wife.*****

Other than what?
*****Aunt also has a checking account with about $2K which was frozen by the bank after her death.******

No reason to think it would be.

I think you ought to consult with a local attorney to make sure all processes are done correctly. I can think of no reason for urgency. Nor can I think of any good reason for recording a "new deed" (unless you have an unexpressed interest in transferring title to someone else).

Thanks for the reply.

 

[Tax Counsel]

Hello,
Is the house at risk due to the money owed to the hospital?

The assets of her estate are subject to attachment by creditors. But being the life tenant of a life estate means her asset is her right to the life tenancy. That right, and thus the asset, disappear upon her death and the remainderpersons get the rights previously held by the life tenant.

Should we record a new deed as soon as possible?

Unless there is something else going on here that you failed to mention then the new deed should be filed ASAP. Talk with an attorney before you do it to be sure it's the right move and that it's done properly.

 

[Garth2023]

The assets of her estate are subject to attachment by creditors. But being the life tenant of a life estate means her asset is her right to the life tenancy. That right, and thus the asset, disappear upon her death and the remainderpersons get the rights previously held by the life tenant.



Unless there is something else going on here that you failed to mention then the new deed should be filed ASAP. Talk with an attorney before you do it to be sure it's the right move and that it's done properly.

Thanks.

 

[zddoodah]

Unless there is something else going on here that you failed to mention then the new deed should be filed ASAP.

What deed? There's already a deed that gives the OP the remainder interest. The OP should probably file/record a survivor's affidavit or affidavit of death of life tenant, but what reason would there be to file/record a "new deed"?

 

[Tax Counsel]

What deed? There's already a deed that gives the OP the remainder interest. The OP should probably file/record a survivor's affidavit or affidavit of death of life tenant, but what reason would there be to file/record a "new deed"?

At least in my state you'd do that to eliminate all references to the life estate so that when the owners sell they won't need to deal with reluctant buyers who don't understand life estates and would rather not have to figure that out.