Our Real Property Services
General Philosophy for Real Estate Document Preparation
Thompson Law Group, P.C. provides document preparation services relating to real estate transactions at a reasonable cost. We also review previous documentation in the chain of title to ensure its validity and work with the client to correct any title defects. Most clients know what they wish to accomplish, but not necessarily the most beneficial way to accomplish it. Clients often choose the wrong type of document, such as a quitclaim deed as opposed to a warranty deed, without realizing the ramifications, both legal and tax-wise and are surprised later when they learn that the transfer was incorrect or invalid and then sometimes it is too late to fix the problem. To avoid attorney fees, many people opt to purchase a form from a local office supply store or online. Unfortunately, most documents found online or at office supply stores are not state specific and may not be valid in the State of Arizona. In addition, the form document may not have been recently updated to account for frequent changes to the law. Failure to use the correct document or prepare it correctly may create a cloud on the title or it may be unenforceable. In addition, a title company may not insure any future transfers or sale of the real property without clearing up the problem. What many people do not realize is that defects in the chain of title to real property do not go away, until they are properly corrected. In short, the money believed to be saved in purchasing a form online or at the local office supply store will ultimately be spent (if not even more) correcting the title of real property.
All documents prepared by Thompson Law Group, P.C. are specific to the laws of the State of Arizona and are not generic such as those found at an office supply store or online at a legal document preparation website. We specifically tailor all documents to a client’s individual needs and they are reviewed by an attorney to be sure that they comply with all of the appropriate state laws. The document preparation services we provide include, but are not limited to, deeds for transferring or changing title to real property, promissory notes for loans, powers of attorney, deeds of trust, security agreements, subordination agreements, release instruments, and bills of sale. Further, documents are reviewed not only from a legal standpoint but from a title insurance standpoint as well. Our staff has an intensive title insurance background. We work closely with title insurance companies to make sure that the documents we have prepared will pass their scrutiny in insuring the property at some future date.
Unfortunately, errors in real title transfers do not get better with time. They must ultimately be addressed and corrected. Generally, the earlier defects are detected, the easier they are to correct. If you have any doubt regarding the validity of a transfer of property, please contact us so that we may review the transfer and ensure that the transfer has been effective for what you wish to achieve.
The Thompson Law Group, P.C. is committed to providing quality legal service at reasonable rates. We generally provide our documentation preparation services at a flat rate so that the fees are certain. If it is necessary to provide additional services, such as tp review additional documents, chain the title, etc., in order to prepare the necessary documents or cure title defects, we inform you of this expense prior to commencement of any work to avoid any confusion about what is necessary to make your transaction valid.
Our business is getting you back to your business.
Beneficiary Deeds Q&A
Arizona law allows the owner of real property to convey all their interest in real property to a designated beneficiary to be effective only upon the owner’s death. For many people, their home is their greatest asset, and they want to be able to transfer it to a certain person or persons in a simple, inexpensive means that avoids probate. A beneficiary deed will accomplish this transfer without the need of a formal probate.
A beneficiary deed has several advantages over the other methods of avoiding probate with respect to the transfer of title to real property. The affidavit procedure is only available where the equity in the property is within the statutory limitation (currently $100,000.00), and it cannot be used until 6 months have passed from the date of death of the property owner. If the property is an asset of a living trust, the successor trustee must interpret the provisions of the trust and then have a deed prepared transferring the property to the beneficiaries named in the trust. When a beneficiary deed, properly prepared and recorded, combined with the subsequent recording of the death certificate for the grantor (property owner), the real property transfers automatically to the beneficiary named in the beneficiary deed. The Beneficiary Deed then becomes the named beneficiary’s title to the property. Beneficiary deeds may be changed at any time prior to the death of the grantor (property owner) and do not affect any tax or debt obligations of the beneficiary until the death of the grantor (property owner) since the beneficiary has no legal or equitable interest in the real property until the grantor (property owner) dies. In short, the creditors of a beneficiary may not attempt to collect from the real property and there are no tax ramifications or other legal obligations to the beneficiary while the owner is alive.
The beneficiary deed is a very useful tool for transferring a person’s home or other real property upon a person’s death, but as with other deeds, it should be prepared by a professional.
A large part of business at Thompson Law Group, P.C. has been correcting titles to real property where deeds were incorrectly prepared. Deeds must correctly reflect marital status, and contain an accurate legal description.
THE DOWNSIDE OF DIY:
One of the most common defects in any transfer of real property via generic self-help forms is the failure to accurately state the legal description of the real property. Further, the generic self-help forms do not include the mandatory disclosures required by Arizona law when a trust is involved which may make the title transfer unenforceable and void.
Beneficiary deed? What is it?
Arizona law allows the owner of real property to convey all their interest in real property to a designated beneficiary to be effective only upon the owner’s death. For many people, their home is their greatest asset, and they want to be able to transfer it to a certain person or persons in a simple, inexpensive means that avoids probate. A beneficiary deed will accomplish this transfer without the need of a formal probate. Read more about avoiding probate in the blue section below.
A beneficiary deed is in some respects more complicated than other deeds, because it must correctly reflect the beneficiary (the person receiving the property after the decedent’s death) and in what capacity.
For example, if property is left to numerous children, will they obtain title as tenants in common?
What happens if one of the children dies before the grantor of the beneficiary deed? Will grandchildren inherit if one of the children is deceased when the property is transferred?
For a husband and wife, do they understand that a beneficiary deed for property held in community property with right of survivorship can be revoked by the surviving spouse, giving the surviving spouse the power to change whom the property is ultimately transferred to upon death?
These and other questions should be answered before preparation of a beneficiary deed. Just as in the case of a will or a living trust, the preparer of a beneficiary deed should make sure that it accurately reflects the desires of the person planning his or her estate.
Thompson Law Group, P.C. is committed to providing quality legal service at reasonable rates.
We generally provide our documentation preparation services at a flat rate so that the fees are certain. If it is necessary to provide additional services, such as review additional documents, chain the title, etc., in order to prepare the necessary documents or cure title defects, we inform you of this expense prior to commencement of any work to avoid any confusion about the necessary work to protect your transaction.
Should I Use a Joint Tenancy Deed?
A word of caution is necessary with respect to the use of joint tenancy deeds. Many people have come to Thompson Law Group, P.C. asking for the preparation of joint tenancy deeds. Frequently, they want to add a child to the title of their real property (make the child a “joint tenant”), for the purpose of avoiding probate and transferring the property to their child upon their death. A joint tenancy deed will make the child an equal owner of the property. While it is true that a joint tenancy deed will avoid probate, it is not the only means of doing so, and may have serious adverse tax consequences as well as legal ramifications prior to the property owner’s death. If property is transferred by will or by beneficiary deed, upon the death of the owner, the heir will get what is called a “step-up in tax basis”. This may result in the elimination of part or all of any income tax on the sale of the property. The use of a joint tenancy deed will not provide a step-up in tax basis, and therefore may result in substantial income taxes on the subsequent sale of the property that could have been avoided.
In addition to possible adverse tax consequences, the use of a joint tenancy deed places another person on the title to the property, and therefore the original owner cannot transfer, sell, mortgage, or rent the property without the consent of the other joint tenant. The credit history of the joint tenant may be considered in obtaining financing. Perhaps of even greater concern is that outstanding judgments or tax liens against the joint tenant that are recorded in the county where the property is located will attach to the title to the property as soon as the joint tenant is added to the title. This means that the joint tenant’s creditors may use the property (sell it) to pay any judgments or liens of the joint tenant.
While joint tenancy deeds are appropriate in some circumstances, Thompson Law Group, P.C. makes sure that its customers are advised of the potential disadvantages of joint tenancy, and the other options for transferring property and avoiding probate that are available to its clients.
Thompson Law Group, P.C. is committed to providing quality legal service at reasonable rates. We generally provide our documentation preparation services at a flat rate so that the fees are certain. If is necessary to provide additional services, such as review additional documents, chain the title, etc., in order to prepare the necessary documents or cure title defects, we inform clients of any additional expense prior to commencement of any work to avoid any confusion about fees or additional work to protect a client’s transaction and make it valid.
Should property be transferred into my trust?
There are benefits if it is.
Once your trust has been created, it is very important that you transfer all your assets into your trust, or your trust will have no effect. Many people that have formed a trust themselves using general self-help forms do not actually transfer their property into the trust. If property intended to be in trust is not properly transferred, then it is as if the trust never existed at all and will have no legal effect. While we do not provide any assurance as to the legal validity of your trust, which you would need to have determined by your estate planning attorney, we do assure you that any transfers in or out of your trust comply with Arizona law. Transfers into or out of a trust in Arizona are far more complicated than average transfers and require certain disclosures pursuant to Arizona statutes. Again, we make sure that the transfer will not only comply with Arizona law but will satisfy the title company’s requirements for future insurability of the property, as well.
Thompson Law Group, P.C. is committed to providing quality legal service at reasonable rates. We generally provide our documentation preparation services at a flat rate so that the fees are certain. If is necessary to provide additional services, such as review additional documents, chain the title, etc., in order to prepare the necessary documents or cure title defects, we will inform you of this expense prior to the commencement of any such work.
The information provided in this website is meant only as a general description of the current laws as of the date of the writing. It is not meant to be an exhaustive discussion of all the nuances of the law and is intended to be only an overview. Many issues may appear simpler than they are, and an individual should always contact an attorney to obtain a complete, accurate interpretation of the law given the individual's particular circumstances. Thompson Law Group, P.C. makes no representations as to how the law would affect a particular situation and intends only to illustrate areas of concern and give general information.