A Lady Bird Deed, (also known as an Enhanced Life Estate deed), is a legal tool that allows property owners to effectuate the transfer of real estate to named individuals upon their death, while retaining control during their lifetime. This type of deed is a toll that can help avoid the need for probate administration.

Many Michigan homeowners want to make sure their home passes to their children without going through the lengthy and often costly probate process. A common, but ill-advised approach, is to add your children as joint owners to your home's title. While this may seem simple, it can create serious legal and financial risks. To help avoid unintended consequences, one estate planning solution is the preparation of a Lady Bird Deed, which offers flexibility, control, and protection.

The Risks of Adding Kids to Your Title

Adding your children to your home's title might seem like a simple way to ensure they inherit your house, but it can potentially cause problems. First, it exposes the equity in your home to your children's legal and financial troubles. If they are sued, go through a divorce proceeding, or file for bankruptcy - your home could become part of their legal issues. You also lose control—if you ever want to sell or refinance, you need their permission.

Many people attempt to draft their own deeds, thinking they can handle it themselves using a template found online. Unfortunately, homemade deeds are often done incorrectly, which can lead to costly legal problems down the road. Mistakes can make the transfer invalid or ultimately end with your loved ones needing to open a probate estate upon your passing.

An Estate Planning Alternative: A Lady Bird Deed

A Lady Bird or Enhanced Life Estate deed, allows you to retain ownership and control of your home during your lifetime, while helping to ensure a smooth transfer to your chosen beneficiaries upon your death—without probate. This means you can sell, refinance, or change beneficiaries without needing your children's permission.

Another option is to name your living trust as the “beneficiary” on your Lady Bird Deed. This way, if you later want to change who inherits your home—such as including grandchildren—you only need to update your trust document. If your children were given title to your home by means of a deed, you would need their signature on subsequent deeds to change the “beneficiary”.

Keep Control and Avoid Costly Mistakes

A Lady Bird Deed is one estate planning mechanism that can provide a simple and effective way to pass your home to your intended beneficiary while keeping control of your home during your lifetime.

Your home is often one of your most significant and valuable assets. Ensuring its transfer is handled correctly is worth the investment. Instead of taking the risk of a DIY approach, working with a professional can provide peace of mind.

If you're considering your options, consulting with an estate planning attorney can help ensure your home is protected and your wishes are carried out smoothly.

Why Do They Call It a Lady Bird Deed?

Despite popular belief, the name "Lady Bird Deed" does not originate from former First Lady Claudia "Lady Bird" Johnson. In reality, Florida attorney Jerome Ira Solkoff coined the term in the 1980s while using fictional characters, including "Lady Bird," to illustrate the deed's benefits in his legal materials. Over time, the name became associated with this estate planning tool.