If an individual dies owning a timeshare, their heirs may needlessly pay thousands in probate expenses. Probate for a timeshare interest can be avoided by using a timeshare beneficiary deed.
Probate Of Timeshares Can Be Expensive
Probate is a legal process by which the title to a timeshare is formally transferred at death. A primary probate proceeding is opened in the state where the deceased is domiciled at the time of death. Ancillary probate is a probate proceeding opened in another state to transfer property owned by the deceased in that state.
Typically, real estate or a timeshare interest is the property to be transferred in a primary or ancillary probate proceeding. The cost of a single ancillary probate proceeding can be thousands of dollars just to transfer a single timeshare week.
How to Avoid Probate For A Timeshare Interest
Avoiding probate for a timeshare interest is easy. All you need is a timeshare beneficiary deed. In Colorado, for example, an individual can create a payable on death designation for a timeshare by executing and recording a payable on death designation for the Colorado timeshare interest.
Colorado calls this a timeshare beneficiary deed. While a Colorado timeshare beneficiary deed is executed and recorded, today, in the Colorado county where the timeshare is located, it passes no interest in the timeshare until the death of the current owner. Since 1995, at least seven other states have enacted laws allowing some type of timeshare beneficiary deed.
Hopefully, even more, states will follow.
Using a Colorado Timeshare Beneficiary Deed Instead of Trusts and Corporations
Timeshare Owners Take Note: Colorado Beneficiary Deeds are Superior to Trust Transfers. The traditional method to avoid Colorado probate for Colorado real estate is to transfer the Colorado timeshare to the owner’s trust or corporation. The better solution is a Colorado Beneficiary Deed.
The Trouble With Trusts for Timeshares
Troubles of Transferring Timeshares to Trusts Many Colorado timeshare owners do not understand that a transfer to a trust or corporation can trigger significant documentation requirements by the Colorado timeshare association.
For example, the Association should require a copy of the trust, complete disclosure of trustees incuding address and telephone number and a RECORDED statement of authority. Many of these transfers to trusts and corporations result in unmarketable title.
Colorado Beneficiary Deed is Hassle-Free
The solution to the stringent documentation requirements is a Colorado Beneficiary Deed. A Colorado Beneficiary Deed does not change any ownership until the death of the current owner. At that time, the Colorado timeshare passes directly to the new owner. All that is required is a recorded death certificate and a supplemental affidavit.
Attention! We are not attorneys and we are not lawyers. We cannot represent customers, select legal forms, or give advice on rights or laws. The article provided is for information ONLY and is NOT a substitute for the advice of a lawyer.