If you own a home or land in Mississippi and want it to pass to your loved ones without probate, two tools come up most often: a deed reserving a life estate and a transfer-on-death (TOD) deed. Both keep real property out of probate. But they differ sharply in how much control you keep, whether you can change your mind, and how they affect Medicaid planning and creditors.
The Deed Reserving a Life Estate
With a life estate deed, you give away the “remainder” of your property today while keeping the right to live in it, use it, and collect any income from it for the rest of your life. The people who receive the remainder (called remaindermen) own a vested interest the moment the deed is signed and delivered.
That present gift is the key feature. You keep your homestead exemption, but you cannot undo the deed on your own, and you need the remaindermen’s consent to sell, mortgage, or partition the property. At your death, the property passes to them automatically and can be transferred right away, with no 90-day creditor waiting period.
The Transfer-on-Death Deed
A TOD deed transfers nothing while you are alive. You name one or more beneficiaries, including contingent beneficiaries, and they receive the property only at your death. The deed must be recorded before you die to be effective.
Until then, you remain the full owner. You can sell, mortgage, or give away the property without anyone’s permission, and you can revoke or change the deed at any time by recording a new TOD deed or a revocation. Your homestead exemption is unaffected.
Which One Is Right for You?
A life estate deed often fits owners who are comfortable making an irrevocable gift now, such as after the Medicaid look-back period has run, or where certainty of intent matters most. A TOD deed often fits owners who want full flexibility and control during life while still avoiding probate at death.
The right choice depends on your family, your property, and your long-term care plans. Sullivan Law Firm, PLLC, on the Mississippi Gulf Coast, helps clients with estate planning, real property transfers, and probate. Contact us to talk through which deed makes sense for you.
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