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Do You Need a Lady Bird Deed if You Have a Trust?

House with a Deed


If you are planning your estate, you might be asking a common question: "If I already have a trust, do I still need a Lady Bird Deed?"

The short answer is: It’s not always one or the other. While both tools are designed to help your loved ones avoid the headaches of probate, attorneys often suggest utilizing the two of them together for maximum protection and efficiency.

Quick Answer: The Strategy

A Lady Bird Deed (available in Texas, Vermont, Michigan, West Virginia, and Florida) transfers real estate upon death to avoid probate. A Revocable Trust manages assets and avoids probate for your entire estate. By using a Lady Bird Deed to name your Trust as the beneficiary, you can keep the property in your name while alive (protecting Homestead status and mortgages) while ensuring a Trustee manages the property efficiently after you pass.


What is a Lady Bird Deed?

First, it is important to know that a "Lady Bird Deed" is not recognized everywhere. There are currently only five states that recognize an actual Lady Bird Deed:

  • Texas

  • Vermont

  • Michigan

  • West Virginia

  • Florida

(Note: Other states may recognize a similar document called a "Transfer on Death Deed" or TODD).

The Purpose of the Deed

A Lady Bird Deed is strictly a land deed focusing on real property. Its primary goal is to allow you to transfer real estate to one or more beneficiaries upon your passing so that the property does not have to go through probate.

Probate can be sticky, expensive, and time-consuming. It delays the time it takes for heirs to actually inherit the property and change the title. A correctly drafted Lady Bird Deed prevents the need for this court process.

What is a Revocable Trust?

A Revocable Trust is a tool that allows you to maintain control and direction of your assets during your life. You can change the terms, provisions, and assets held by the trust at any time.

Like the deed, a trust is specifically designed so that your assets—including real property—do not have to go through probate. However, while a Lady Bird Deed is only for real estate, a trust connects all your assets to avoid the court process.

Why Use Both? The "Hybrid" Strategy

If a trust already avoids probate, why would you need a Lady Bird Deed? It essentially comes down to beneficiary management and asset protection while you are alive.

1. Solving the "Multiple Beneficiaries" Problem

If you use a Lady Bird Deed to leave a house to multiple people (for example, three or seven different beneficiaries), problems can arise:

  • They may not get along.

  • They may not agree on what to do with the property.

  • Disagreements can hold up the sale of the property.

  • It can lead to necessary court action to resolve the dispute.

The Solution: If you name your Trust as the beneficiary on the Lady Bird Deed, a single person (the Trustee) takes charge. The Trustee can manage, sell, or divide the asset efficiently, ensuring the best interest of all beneficiaries without the fighting.

2. Protecting Homestead and Mortgages

You might ask, "Why not just put the property directly into the trust right now?"

While you can put property into a trust, keeping it in your name (or the names of spouses) via a Lady Bird Deed during your lifetime offers specific benefits:

  • Homestead Protection: In places like Florida, Homestead property is exempt from claims of most creditors (like credit card or medical bills, though not mortgages). If you pass Homestead property to descendants, it retains that character. Keeping the deed in your name can make it simpler to maintain these protections and tax reductions.

  • Mortgage Concerns: While transferring a home to a revocable trust shouldn't cause a bank to call a loan due, keeping the property in your personal name eliminates that worry entirely.

The Bottom Line

You can use these tools independently, but they often work best together.

By preparing a Lady Bird Deed that names your Revocable Trust as the beneficiary:

  1. The title stays in your name while you are alive (avoiding mortgage or homestead issues).

  2. When you pass, the property automatically goes into the trust, avoiding probate.

  3. The Trustee handles the property according to your rules, avoiding family disputes.

Need Help in Florida?

If you have questions about Lady Bird Deeds, Estate Planning, or how to protect your assets in Florida, we are here to help.

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