Skip the courthouse drama and lengthy delays – your family deserves better than months of probate proceedings when you pass away
When you own real estate in Washington, the last thing you want is for your loved ones to spend months tied up in probate court after you’re gone. The good news? Washington law provides several proven methods to transfer your property directly to your beneficiaries, bypassing the probate process entirely. These strategies can save your family thousands of dollars in court costs, attorney fees, and months of uncertainty.
Whether you own a single-family home in Seattle, vacation property in the San Juans, or rental properties across the state, this blog will show you exactly how to set up your real estate transfers now so your family can avoid probate later.
What Happens When Real Estate Goes Through Probate in Washington?
Probate is the court-supervised process of distributing a deceased person’s assets. In Washington, when real estate must go through probate, your family faces several challenges:
The process typically takes 4-12 months, even for straightforward cases. During this time, your property may sit vacant while family members wait for court approval to manage or sell it. Legal fees and court costs can easily reach $3,000-$15,000 or more, depending on the property’s value and any complications that arise.
All probate proceedings become public record, meaning anyone can access information about your property, debts, and beneficiaries. Your family members may also face restrictions on what they can do with the property until the court gives final approval.
Can You Transfer Real Estate Without Probate in Washington?
Yes, Washington law provides several methods to transfer real estate outside of probate. At death, real property in Washington can generally pass “outside of probate” only if it was transferred to specific ownership structures during life. The key is planning ahead and using the right legal tools.
Currently, Washington allows estates worth up to $100,000 to avoid probate through a simple sworn statement affidavit under RCW 11.62.010. However, since most real estate exceeds this threshold, property owners typically need to use other probate avoidance strategies.
Five Ways to Transfer Washington Real Estate Without Probate
1. Transfer on Death Deeds (TOD Deeds)
Washington’s Uniform Real Property Transfer on Death Act became effective on June 12, 2014, giving property owners a powerful new tool. A Transfer on Death Deed allows you to name beneficiaries who will automatically receive your property when you die, without any court involvement.
Here’s how TOD deeds work in Washington:
You retain complete ownership and control of your property during your lifetime. You can sell it, mortgage it, or change your mind about the beneficiaries at any time. The deed only takes effect when you die, and only if you still own the property at that time.
Requirements under RCW Chapter 64.80:
- The deed must be in writing and properly notarized
- It must clearly state that the transfer occurs at death
- You must record it with the county auditor’s office before your death
- The interest of a designated beneficiary is contingent on the designated beneficiary surviving the transferor
Recording costs: As of January 1, 2024, Washington counties charge $303.50, plus $1 for each additional page to record a transfer on death deed.
The main advantage of TOD deeds is simplicity – you can set them up yourself without creating a trust. However, they offer less flexibility than trusts for complex situations and don’t provide protection if you become incapacitated.
2. Joint Tenancy with Right of Survivorship
Joint tenancy with right of survivorship permits property to pass to the survivor without the cost or delay of probate proceedings, according to RCW 64.28.010. A joint tenancy with right of survivorship in Washington allows the interest of one party to automatically transfer to the other party upon their death.
When you hold property in joint tenancy, each owner has an equal, undivided interest in the entire property. If one owner dies, their share automatically transfers to the surviving owner(s) without going through probate.
Creating joint tenancy in Washington: Joint tenancy shall be created only by written instrument, which instrument shall expressly declare the interest created to be a joint tenancy. The deed must specifically state “joint tenancy” or “joint tenancy with right of survivorship” – vague language won’t work.
Benefits:
- Immediate transfer upon death
- No court involvement required
- Relatively simple to establish
Drawbacks:
- You give up sole control of your property
- Each joint tenant can potentially force a sale or transfer their interest
- May create gift tax consequences
- Doesn’t help with incapacity planning
- Can complicate Medicaid planning
Joint tenancy works well for married couples but can create problems when used with adult children or other family members who might later have financial difficulties or marital issues.
3. Living Trusts
A revocable living trust is often the most flexible way to avoid probate for real estate. With a trust, you transfer ownership of your property to the trust, but you retain complete control as the trustee during your lifetime.
When you die, the successor trustee you’ve named can immediately transfer the property to your beneficiaries according to your trust instructions – no court involvement required.
Advantages of trusts for real estate:
- Avoids probate completely
- Provides incapacity protection
- Keeps your affairs private
- Allows complex distribution instructions
- Can hold multiple properties
- Provides flexibility for changing circumstances
Setting up a trust for real estate: You’ll need to prepare a trust document and then transfer your property deed into the trust’s name. This requires recording a new deed showing the trust as the owner. While this process requires more initial work than a TOD deed, it provides much greater flexibility.
Trusts work particularly well if you own multiple properties, have a blended family, want to provide ongoing management for beneficiaries, or have concerns about a beneficiary’s ability to handle a large inheritance responsibly.
4. Community Property with Right of Survivorship
Washington is a community property state, and married couples have a special option. You can hold property as “community property with right of survivorship,” which combines the benefits of community property ownership with automatic transfer to the surviving spouse.
This method only works for married couples, but it offers some tax advantages. When the first spouse dies, the surviving spouse receives a “stepped-up basis” on the entire property for tax purposes, potentially saving significant capital gains taxes if the property is later sold.
To establish this form of ownership, your deed must specifically state “community property with right of survivorship” – general community property ownership doesn’t automatically include survivorship rights.
5. Life Estate Deeds
A life estate deed allows you to transfer ownership of your property while retaining the right to live there for the rest of your life. When you die, the property automatically transfers to the named “remaindermen” without probate.
With a life estate, you keep the right to:
- Live in the property
- Collect any rental income
- Make ordinary repairs and improvements
However, you generally cannot sell or mortgage the property without agreement from the remaindermen.
Life estate deeds can work well in specific situations, such as when elderly parents want to guarantee that their home goes to their children while ensuring they can stay there for life. But they’re less flexible than other options and can create complications if family relationships change.
Which Method Should You Choose for Your Washington Real Estate?
The best probate avoidance strategy depends on your specific situation:
Choose Transfer on Death Deeds if:
- You want to keep things simple
- You don’t need incapacity protection
- You’re comfortable with beneficiaries receiving property outright
- You own a single piece of real estate
Choose Joint Tenancy if:
- You’re married and want automatic transfer to your spouse
- You’re comfortable sharing control during your lifetime
- You don’t have complex family situations
Choose a Living Trust if:
- You own multiple properties
- You want incapacity protection
- You have complex family situations
- You want ongoing management for beneficiaries
- Privacy is important to you
Choose Community Property with Right of Survivorship if:
- You’re married
- You want tax advantages
- You want to maximize stepped-up basis benefits
Choose Life Estate Deeds if:
- You want to guarantee you can stay in your home for life
- You have a close, stable family relationship
- You’re doing Medicaid planning (consult an attorney first)
How Much Does It Cost to Avoid Probate in Washington?
The costs vary depending on which method you choose:
Transfer on Death Deeds: Recording fees of around $303.50 plus any attorney fees if you hire someone to prepare the deed.
Joint Tenancy: Cost of preparing and recording a new deed, typically $200-$500 if done by an attorney.
Living Trusts: Attorney fees typically range from $1,500-$4,000 for a comprehensive trust package, plus recording fees for transferring real estate.
Other deed methods: Similar to joint tenancy, mostly involving deed preparation and recording costs.
Compare these one-time costs to typical probate expenses of $3,000-$15,000 or more, and the savings become obvious.
Common Mistakes to Avoid When Transferring Real Estate
Many people make costly errors when trying to avoid probate with real estate:
- Improper deed language: Washington law is specific about the language required for different types of ownership. A deed that says “John and Mary Smith” without more creates tenancy in common, which doesn’t avoid probate. You need clear language like “joint tenancy with right of survivorship” or “community property with right of survivorship.”
- Forgetting to record the deed: Your new deed isn’t valid until it’s properly recorded with the county auditor’s office. Many people prepare deeds but forget this crucial step.
- Not updating beneficiaries: Life changes, but many people forget to update their beneficiary designations on TOD deeds or trust documents after divorce, remarriage, or when adult children have their own families.
- Mixing different ownership types: If you own multiple properties, using different probate avoidance methods for each one can create confusion and complications for your family.
- Ignoring tax consequences: Some probate avoidance methods can trigger gift taxes or affect your property tax exemptions. For example, adding adult children to your deed as joint tenants might be treated as a taxable gift.
- Not considering incapacity: TOD deeds and joint tenancy don’t help if you become incapacitated and can’t manage your property. Only trusts and life estates provide ongoing management in those situations.
What About Mortgage and Property Taxes?
Most probate avoidance methods don’t affect your existing mortgage. However, some loan agreements include “due on sale” clauses that could potentially be triggered by certain transfers. In practice, transferring property to a revocable trust or adding a spouse as a joint tenant rarely causes problems, but you should review your loan documents or consult with your lender.
Property taxes generally aren’t affected by probate avoidance strategies, since you’re still the beneficial owner during your lifetime. However, some transfers might affect property tax exemptions for seniors or disabled persons, so check with your county assessor if you have these exemptions.
Step-by-Step: Setting Up Your Probate Avoidance Plan
Here’s how to get started:
- Step 1: Inventory your real estate. Make a list of all properties you own, including your home, vacation properties, rental properties, and vacant land. Note how each property is currently titled.
- Step 2: Decide on your beneficiaries. Who do you want to receive each property? Do you want them to inherit immediately, or would you prefer ongoing management through a trust?
- Step 3: Choose your probate avoidance method. Based on your situation and goals, select the most appropriate strategy for each property.
- Step 4: Prepare the necessary documents. This might involve preparing new deeds, setting up a trust, or both.
- Step 5: Record your documents. File any required documents with the appropriate county auditor’s office.
- Step 6: Update related documents. Make sure your will, insurance policies, and other estate planning documents are consistent with your new property ownership structure.
- Step 7: Review regularly. Your probate avoidance plan should be reviewed every few years or after major life changes.
Key Takeaways
- Washington law provides several effective methods to transfer real estate without probate, including Transfer on Death Deeds, joint tenancy, living trusts, and other strategies.
- Transfer on Death Deeds became available in Washington on June 12, 2014 and offers a simple way to name beneficiaries for your real estate.
- Joint tenancy with right of survivorship must be created with specific language in the deed and allows automatic transfer to surviving owners.
- Living trusts provide the most flexibility and include incapacity protection, making them ideal for complex situations or multiple properties.
- Proper planning can save your family thousands of dollars in probate costs and months of delays.
- Each method has specific requirements under Washington law – improper execution can result in your property still going through probate.
- The key is taking action now while you’re able to make these decisions yourself.
Frequently Asked Questions
Q: Can I use a Transfer on Death Deed if I still have a mortgage on my property?
A: Yes, you can generally use a TOD deed even with an existing mortgage. The beneficiary will inherit the property subject to the mortgage, meaning they’ll need to continue making payments or pay off the loan. However, you should review your mortgage agreement for any “due on sale” clauses.
Q: What happens if my TOD deed beneficiary dies before I do?
A: The interest of a designated beneficiary is contingent on the designated beneficiary surviving the transferor. The interest of a designated beneficiary that fails to survive the transferor lapses. This means if your beneficiary predeceases you, that portion of the property will go through probate unless you’ve named alternate beneficiaries.
Q: Can I change my mind after setting up joint tenancy?
A: Joint tenancy can be severed, but it requires cooperation from all joint tenants or court action. Once you add someone as a joint tenant, they have immediate ownership rights in the property, which can complicate changes later.
Q: Do I need an attorney to set up probate avoidance for my real estate?
A: While you can prepare some documents yourself, Washington’s specific legal requirements make attorney assistance valuable. Mistakes in deed preparation or trust creation can result in failed probate avoidance, making the modest upfront investment in professional help worthwhile.
Q: Will transferring my property affect my homestead exemption?
A: Transferring your primary residence to a revocable trust typically doesn’t affect your homestead exemption, since you remain the beneficial owner. Other transfer methods may have different impacts, so consult with a tax professional if you have concerns.
Q: Can I use these methods for out-of-state property?
A: Each state has its own laws about real estate transfers and probate avoidance. If you own property outside Washington, you’ll need to comply with that state’s requirements, which may be different from Washington law.
Q: What’s the difference between a Transfer on Death Deed and a traditional will?
A: A TOD deed transfers specific real estate automatically outside of probate, while a will must go through probate to be effective. TOD deeds take precedence over conflicting will provisions for the covered property.
Q: How long does it take to set up probate avoidance for real estate?
A: Simple methods like TOD deeds can be completed in a few weeks once you’ve made your decisions. More complex strategies like living trusts may take 1-2 months to complete all the necessary steps, including property transfers.
Contact Us: Secure Your Family’s Future Today
Don’t leave your family’s inheritance to chance. Every day you delay setting up probate avoidance for your real estate is another day your loved ones remain vulnerable to the costs, delays, and stress of probate proceedings.
At James A. Jones Attorney At Law, we help Washington families protect their real estate investments and ensure smooth transfers to the next generation. Our personalized approach means we’ll review your specific situation, explain your options in plain English, and help you choose the probate avoidance strategy that best fits your needs and goals.
Whether you own a single family home or a complex portfolio of properties, we have the experience to guide you through Washington’s probate avoidance laws and ensure your plan is properly implemented.
Take the first step toward protecting your family’s inheritance. Contact us today to schedule your free consultation and learn how we can help you transfer your Washington real estate without probate. Your family’s peace of mind is worth far more than the modest investment in proper planning today.
