A Lady Bird Deed in Florida is an enhanced life estate deed that allows a property owner to name someone who will receive the property after the owner’s death while retaining broad control over the property during life.
Unlike a traditional life estate, a properly drafted Lady Bird Deed can allow the owner to sell, mortgage, or otherwise convey the property without the future beneficiary’s permission. It can also allow the property to pass outside the ordinary probate process.
Because Florida does not have a statutory form called a “Lady Bird Deed,” the language used in the deed is especially important.
How Does It Work?
The property owner transfers the property through a deed that reserves an enhanced life estate and identifies one or more people who are intended to receive the property after the owner’s death.
During the owner’s lifetime, the owner generally retains the right to:
- Live in and use the property
- Sell the property
- Mortgage the property
- Convey the property to someone else
- Change or defeat the beneficiary’s future interest, depending on the deed’s language
If the owner dies while the deed remains effective, the property can pass to the designated beneficiary without becoming part of the owner’s probate estate.
The exact result depends on the language of the deed and the circumstances surrounding the property.
Lady Bird Deed vs. a Regular Life Estate
The most important difference is the amount of control retained by the original owner.
With a traditional life estate, the owner keeps the right to possess and use the property for life but gives another person a present remainder interest. Selling or mortgaging the entire property can therefore require the remainderman’s participation.
An enhanced life estate, by contrast, can reserve the owner’s power to sell, mortgage, or convey the property without the beneficiary joining the transaction.
Florida courts have recognized this distinction. In Hirschenson v. Compu-Link Corp. of MI, the Third District Court of Appeal discussed an enhanced life estate as allowing the holder to sell, convey, mortgage, and otherwise manage the property without the remainderman’s joinder.
Does It Avoid Probate?
One reason Florida property owners consider this type of deed is probate avoidance.
If the deed is properly executed and remains effective when the owner dies, the designated beneficiary can receive the property without the real estate passing through the owner’s ordinary probate estate.
That does not mean every Lady Bird Deed will accomplish the same result. The deed must be legally effective, the property’s ownership must be correctly identified, and other Florida property laws may affect the transfer.
Why the Deed’s Language Matters
The enhanced powers need to be clearly established in the deed.
A Florida appellate case illustrates what can happen when the language is unclear. In Hirschenson, the deed contained inconsistent language concerning the power to mortgage the property. The resulting dispute required the court to determine what the deed actually meant, and the trial court ultimately reformed the deed. The appellate court affirmed that decision.
This is why a Lady Bird Deed should not simply be copied from an unidentified online form.
Can You Sell or Mortgage the Property?
A properly drafted enhanced life estate deed can preserve the owner’s ability to sell or mortgage the property without obtaining the future beneficiary’s consent.
That retained control is one of the defining characteristics of the arrangement.
However, the specific deed should be reviewed before a sale or mortgage. The deed’s wording, the property’s current title, and the requirements of the lender or title company can all matter.
What If the Beneficiary Dies First?
This depends on how the deed was drafted.
If the named beneficiary dies before the property owner, the deed should be reviewed to determine what happens to that person’s future interest. The owner may want to name alternate beneficiaries or include other provisions addressing this possibility.
This is one reason the beneficiary provisions should be considered carefully when the deed is prepared.
What If the Property Is Florida Homestead?
Homestead property requires additional care.
Florida law places special restrictions on the disposition of homestead, particularly when the owner has a spouse or minor children. Sections 732.4015 and 732.4017 of the Florida Statutes address important rules concerning homestead and lifetime transfers.
A Lady Bird Deed involving a Florida homestead therefore should not be evaluated solely on whether it can avoid probate. The owner’s family situation, title, and homestead status should all be considered before the deed is prepared.
Who Actually Owns the Property?
Before preparing the deed, it is important to determine how the property is currently titled.
For example, the property may be owned individually, jointly, through a trust, or subject to an existing interest.
In Johnson v. Johnson, Florida’s First District Court of Appeal considered enhanced life estate deeds that had been prepared in an individual’s name even though the properties were actually held by a living trust. The court affirmed reformation of the deeds based on the evidence concerning the mistake.
The practical lesson is simple: the current deed and ownership records should be checked before preparing a new conveyance.
When Might a Lady Bird Deed Be Useful?
A Florida property owner may consider an enhanced life estate deed when the goal is to:
- Retain control of the property during life
- Continue living in the property
- Designate who should receive it after death
- Preserve the ability to sell or mortgage the property
- Potentially transfer the property outside probate
It may not be appropriate for every estate plan. More complicated family circumstances, multiple properties, trusts, creditor issues, or other planning concerns may call for a different approach.
For a detailed comparison between this type of deed and a revocable living trust, see Florida Lady Bird Deed vs. Revocable Living Trust for Real Estate.
Florida Lady Bird Deed FAQs
What is a Lady Bird Deed in Florida?
- It is an enhanced life estate deed that allows a property owner to retain substantial control over real estate while designating who should receive the property after the owner’s death.
Does a Lady Bird Deed avoid probate?
- A properly drafted and effective deed can allow the property to pass to the designated beneficiary outside the ordinary probate process.
Is a Lady Bird Deed the same as a life estate?
- No. A Lady Bird Deed is an enhanced form of life estate that can reserve significantly greater powers for the original owner.
Can I sell my house after signing a Lady Bird Deed?
- Generally, an enhanced life estate can preserve the owner’s power to sell or convey the property without the beneficiary’s consent. The specific deed should be reviewed to confirm the powers it reserves.
Can I mortgage property with a Lady Bird Deed?
- A properly drafted deed can reserve the owner’s power to mortgage the property. The exact language matters.
What happens when the owner dies?
- If the deed remains effective and the property has not otherwise been conveyed, the designated beneficiary can receive the property according to the deed’s terms, potentially without probate.
Does a Lady Bird Deed work for Florida homestead?
- It can, but Florida’s homestead rules create additional considerations involving spouses, minor children, and the owner’s particular circumstances.
Florida Estate Planning Attorneys Serving South Florida
A Lady Bird Deed can be a useful way to plan for the future of Florida real estate while retaining control during life. But the deed needs to match the property’s title and the owner’s circumstances.
Call 954-334-1520 to discuss your estate planning needs and determine whether an enhanced life estate deed is appropriate for your situation.