A life estate is a legal arrangement that allows one person to possess and live on a property, such as land or a home, for their lifetime. Upon their death, ownership transfers to another person or entity. As a life tenant, one has the right to possess the property but not sell it or leave it to others in a will. Remaindermen receive ownership after the life tenant's death but have no rights to use or earn income from the property during the life tenant's lifetime. Life estates can be used to provide for a child or donate to an organization after death while avoiding probate. However, they do not protect the life tenant financially and remaindermen's interests can be affected by things like divorce. Proper

1. Legalities & Practical
Uses of Life Estates
By Branden Cruz & Frank Gonzales

2. Defining Life Estates
“A life estate is a legal arrangement that allows one person to have possession of
property (typically land, a home or buildings on the land) during his or her lifetime and,
after their death, for another person or entity to gain ownership of the property.”
Keep in mind, a life tenant may not always be the original owner of a property

4. Life Tenant Rights & Responsibilities
● Right to possess and live on the land for a lifetime
● Right to sell interest to produce income on the land
● No right to write a will or give ownership to anyone else
● Must remain from engaging in waste & or activities that
prevent future use
● Must assume financial responsibilities of the property

5. Remaindermen Rights & Authority
● Receives full ownership upon life tenants death, however is
recognized as co-owner until death
● Consents and signature by remaindermen is needed for a life
tenant to sell
● No right of use over the property or to obtain income from
the property over the life tenants lifetime
● Not responsible for financial responsibilities during life
tenants lifetime

6. Practical Aspects of Life Estates
● Childrens’ life after death
● Donating to an entity
● Safeguard against medicaid
● A secure unmodifiable deed

7. Courtroom Rulings on Life Estates
● Courts have no authority
once a L.E. is placed
● Taken on a case by case
basis
● Remaindermen can return
interest to L.T. if issued by
consent
Be safe, contact an estate lawyer

8. Life Estates V. Probate
Life estates avoid probate What is probate?
Receipt of probate is the first legal step
in of administering the estate of a
deceased person. This usually occurs
under will or w/o will and long legal
proceedings.
Avoids probate because a
remainderman’s interest in the
property has already been made.

9. Common Questions on Life Estates
● As a LT, can I move ?
● What happens if a life
tenant has his property
foreclosed?
● Can a life estate holder
earn income on the
property?

10. Life Estates Provide No Safeguard
For the Life Tenant
● Not good for life tenants who may not have strong finances in place
● Regardless of a divorce, the L.T. spouse may not assume ownership
For the Remaindermen:
● Remaindermen ownership interests can be awarded as assets to spouse on
divorce proceedings
● Remainderman's creditors can place liens against shares of property upon a life
tenants death

11. Conclusion & Key Takeaways
Life Estates are “For Life”
● Great investment plan for loved ones “Life after death”
● Great for retirees who may choose rid their ownership duties
● Life estates are considered irrevocable transfers
● Must have proper finances in place
Proper estate planning is highly advised

12. Bibliography
- "Life Estate Ownership of Real Estate (Advantages & Disadvantages)." Law Offices of Susan M Mooney RSS.
Web. 16 Apr. 2015. <http://www.susanmooney.com/?page_id=530>.
-"Benefits and Drawbacks of Life Estates." Benefits and Drawbacks of Life Estates. Web. 16 Apr. 2015.
<http://thetrustexperts.com/blog/bid/142351/BeneLifefits-and-Drawbacks-of-Life-Estates>.
-"Estates." Understanding Life Estates. Web. 16 Apr. 2015. <http://trusts-estates.lawyers.com/estate-
planning/life-estates.html#http://trusts-estates.lawyers.com/estate-planning/life-estates.html>.