Can I deed property to my daughter without selling it and have tenancy?

1 answer | Last updated: Oct 24, 2016
Karmajinpa asked...

I am 58, disabled and won't be eligible for Medicare until January 2011. My L-T disability payments will end in October and then my income will be cut in half. I have tried to get the banks to restructure the loan, but they say they have to work with the income I have now and not what I will have, so I need to default before I can even be considered. The house was purchased in 2005, so there is not enough equity for a reverse mortgage. My question is: Can I deed the property over to my daughter (without selling it to her) and with the understanding I would have tenancy, and pay rent, until I can no longer live alone? If I do have to sell it to her (not sure she can afford a second payment), can the sale be structured to give me life-long tenancy?

Expert Answers

Steve Weisman hosts the nationally syndicated radio show A Touch of Grey, heard on more than 50 stations, including WABC in New York City and KRLA in Los Angeles. He is a practicing lawyer specializing in estate planning and is admitted to practice before the United States Supreme Court. He's a public speaker and commentator who has appeared on many radio and television shows throughout the country, and he's the legal editor of Talkers magazine, the preeminent trade publication of talk radio. His latest book is The Truth About Avoiding Scams.

You can most likely give the home to your daughter, however, you should have a lawyer review your mortgage to make sure that there is not a provision that would require the mortgage to be paid off in full if you were to do so. You could also give it to her and have a written tenancy agreement that would permit you to stay in the property subject to your paying rent. You could also give it to her subject to your right to live there during your lifetime through what is called a "life estate" with provisions in the life estate that you would be responsible for the costs incurred through your use of the property. you could also sell it to her subject to your right to live there throughout your life. Your situation sounds complicated, however, and I would urge you to seek the help of an experienced real estate attorney who could advise you as to programs for which you may be eligible to help pay the mortgage and to run the numbers to see what may be the best way to involve your daughter in any financial arrangement for the property.