Whether you own a vacation place, a timeshare, investment property, or a piece of land to build on eventually, many people own real estate outside of the state in which they live. If you plan to leave that property to your children, grandchildren, or other beneficiaries and you simply put it in your Will, the recipients may encounter problems. Not only will your Will have to go through the probate process where you live, but a secondary (or "ancillary") probate will have to b...e opened in each state in which you owned property as well. Probate is a legal process for changing title to the proper heirs of an individual who dies, either with or without a Will. Because state laws vary, unless you have a Will, your principal residence in your home state may be divided one way, while the vacation home, timeshare, or other piece of land may wind up divided differently.

If, for example, you were a Washington resident who also owned investment property in Arizona, your heirs will have to hire an attorney to handle the probate both in Washington and in Arizona because a Washington court obviously doesn't have jurisdiction over Arizona real estate.

Each state also has different rules regarding probate, so you need to talk to a lawyer in the state where your property is located to find out what your heirs will be faced with should you leave them your out-of-state property. Keep in mind, the real estate is distributed based upon the laws of the state in which the property is located.

The three common ways to avoid the hassle, delays, and costs of probate and the additional “ancillary” probate are either to title your property jointly with your spouse or another individual, to use a Transfer on Death Deed (or "TODD") in those states that recognize them, or to place the property into a revocable living trust.

Any of those techniques will keep your out-of-state property from the probate process out of state, saving your heirs time, aggravation, and money, as well as the costs, delays, and hassles of probate and ancillary probate. If you title your property jointly or you use a TODD, the property automatically goes to the survivor or the grantee of the TODD. If you choose to set up a living trust, title to your property is transferred to the beneficiaries named in that trust.

With the help of an experienced estate planning lawyer and some careful planning, you can avoid unnecessary complication for your estate and your heirs. If you have questions about avoiding an ancillary probate for your out-of-state real estate, give us a call at 253.858.5434 to see how we can help.