Life estate deed

Jay_d

New Member
Jurisdiction
New York
Hello,

The background is that my father owns our home and my wife and I live there as well. We all live together. The house is in NY state.

We recently changed the deed to a life estate deed where he transferred the house to my wife and I while still maintaining a life estate for himself.

My questions revolve around liability and who actually owns the asset for insurance reasons.

1. Who technically owns the home?

2. If my wife or I are sued, is the house an asset that someone can come after?

3. Right now, my father has a large auto insurance policy but do my wife and I now need a similar policy for ourselves now that we are on the deed?

I've done lots of reading about how the life tenant (my father) is responsible for all taxes and insurance, etc, which leads me to think that he still has the liability but then again, having my wife and I on the deed must certainly place some liability on us as well, right?

I almost feel like I wouldn't have these kinds of thoughts if it were the scenario of that we lived in our own home elsewhere and my father setup the life estate in a typical estate planning scenario. But, I feel like this scenario of us actually living there changes some of this. Or maybe not. I don't know. I can't completely wrap my head around it.

I understand some of my questions are about insurance and there is a dedicated insurance section on the site but I feel like this is the most appropriate place to start and hopefully understand the ownership/liability.

Thank you for any advice you can give.
 
1. Who technically owns the home?

Mate, a life estate means what the words mean.

A "life estate" is an ownership interest in real property for the duration of THAT person's life.

This person is called a "life tenant," therefore he or she is allowed to possess, use, enjoy use of the property, to collect rents, royalties, and retain any profits; and is also responsible for the costs of maintaining the property.

Bottom line, your father may NOT own the property but maintains complete use and control for so long as he walks God's earth!

As far as any legal liability, that is assumed by the life tenant, your father.

All he needs to do is maintain sufficient insurance to cover life's many exigencies!
 
The reality of the matter is that your husband's name is on the deed, so your husband WILL be named in any lawsuit the comes about related to the property. In the end, it may be found that your husband doesn't actually have legal liability, but he would be wise to have insurance that will provide legal counsel to prove that in court.
 
Who technically owns the home?

I don't know what you mean by "technically owns." It sounds like you want to shoehorn a square peg into a round hole and say that one person owns it and one doesn't. I find this a bit curious since, in the first sentence of your post, you wrote, "my father owns our home." Now it sounds like you don't actually believe it.

Your description of the facts is somewhat unclear, but it appears that your father owns a life estate and you own the remainder interest. One would need to review the relevant deeds to be certain.

If my wife or I are sued, is the house an asset that someone can come after?

If someone gets a money judgment against you, that judgment could be enforced against your interest in the home/property.

Right now, my father has a large auto insurance policy but do my wife and I now need a similar policy for ourselves now that we are on the deed?

That's not a legal question. Do you anticipate being sued for something? Or is this just an abstract/hypothetical concern?

I've done lots of reading about how the life tenant (my father) is responsible for all taxes and insurance, etc, which leads me to think that he still has the liability but then again, having my wife and I on the deed must certainly place some liability on us as well, right?

Liability for what?

The reality of the matter is that your husband's name is on the deed

Are you suggesting that the OP has both a husband and a wife?!
 
Thank you for the responses.

The main reason for my questions is to ultimately understand if the home is protected now that the deed and possibly ownership has changed. Perhaps, who now "owns" it is irrelevant but I thought it would help me better understand the situation.

This is also the reason for the insurance questions. Before the change, my father obviously assumed all responsibility for having home insurance as well as a decent amount of auto liability insurance. However, now that my name is on the deed, I am trying to understand if I need more insurance to protect an asset that may or may not be legally mine.

Based on the responses, it sounds like nothing with my father's insurance situation should change. He needs to maintain his insurance because he still has ownership interest in the home. However, now that my wife and I have been added to deed in such a way that conveys we own the home (even though the legalese states that my father holds the life estate), it sounds like we need to obtain more insurance in terms of auto liability, etc, because it is possible for the house to considered an asset of ours in case we are sued.

Is my understanding correct?
 
now that my name is on the deed, I am trying to understand if I need more insurance to protect an asset that may or may not be legally mine.

If as you purport, your name is on the deed, you possess some interest in the property.

I suggest you speak to your insurance agent about how best to purchase sufficient insurance coverage such as to protect your ownership interest in the property.

In fact, it couldn't hurt to talk to three insurance agents.
 
Based on the responses, it sounds like nothing with my father's insurance situation should change. He needs to maintain his insurance because he still has ownership interest in the home. However, now that my wife and I have been added to deed in such a way that conveys we own the home (even though the legalese states that my father holds the life estate), it sounds like we need to obtain more insurance in terms of auto liability, etc, because it is possible for the house to considered an asset of ours in case we are sued.

Is my understanding correct?

Each of you has an insurable interest. Beyond that, you're getting away from legal issues.
 
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