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How to Transfer Your California Timeshare to Heirs or Beneficiaries
Do you want to transfer your California timeshare to heirs or beneficiaries? Contact the Timeshare Defense Attorneys today for assistance.
What Happens to Your Timeshare on Your Death?
When timeshare owners die, the timeshare is treated the same as any asset in the estate. If your estate plan includes your timeshare property, its ownership transfer to your heirs or beneficiaries will be handled accordingly. If it doesn’t, the timeshare will be subject to probate and dealt with in terms of that process.
Many timeshare contracts contain a “perpetuity clause,” which confers ownership for life and ensures that the asset forms part of your estate when you pass on. Whoever then inherits the asset, whether an heir, beneficiary of a trust, or next of kin, becomes liable for all obligations and benefits under the timeshare agreements.
Transferring the ownership of your timeshare in California depends on your estate plan. The following estate planning options allow you to determine who will inherit your timeshare and how.
Timeshare Property Estate Planning Options
You can deal with your timeshare unit for estate planning in several ways. It’s a great idea to see an estate planning attorney for advice.
Timeshare Under Probate
Deeded or real property timeshares are potentially subject to probate proceedings in probate court. If you leave your timeshare to an heir in your will, the asset is subject to probate.
Probate proceedings can be expensive and time-consuming. Moreover, your heirs will not be able to use the timeshare during the probate process while still having to pay all expenses related to the timeshare.
So if you fail to deal with your timeshare in your proper estate planning now, it will likely be subject to probate.
Co-Trusteeship
If you register another party or parties as co-trustees up front, they will have the option at the time of your death to keep the timeshare, sell it or even abandon it.
They will become liable for all expenses under the contract if they elect to keep it.
Joint Tenancy
Joint tenancy is property ownership where two (or more) people purchase a timeshare together. Co-owner equally share the vacation property’s financial obligations and benefits.
Joint tenancy allows you to avoid the probate process. If you register your timeshare title as a joint tenancy with someone else, the surviving owner will automatically become the property’s sole tenant on the co-owner’s death. It will not form part of your deceased estate.
Once the joint tenant passes on, the property could become the subject of probate.
Joint tenancy may have potential drawbacks in that you will sacrifice some control over the timeshare property, and it could become the target of creditors of your joint tenant. These complications can be avoided through the use of a revocable living trust.
Use of a Revocable Trust
Revocable trusts are usually used to avoid probate for certain assets in the trust and for tax benefits. They are revocable because they can be changed or updated at any given time before your death.
When you die, the timeshare placed in a revocable trust is not part of your deceased estate and is not subject to probate. Instead, the trust deed will transfer the former timeshare interests to a named beneficiary in the trust.
Timeshare Transfer to Heirs – A Blessing or a Curse?
It may be worth considering whether transferring your timeshare to your heirs is a good idea.
Your heirs may have different needs or appetite for timeshare inheritance than you had for its ownership.
Your named beneficiaries may be unable to afford the annual timeshare maintenance fees, special assessments, and other fees the timeshare contract obliges the owner to pay. These obligations may become a burden to your heirs.
Consider whether the timeshare you have is suitable for them. Due to different holiday schedules, you may have a fixed timeshare week which they cannot take advantage of.
So, before you treat your heirs to a timeshare gift, it’s a great idea to sit down with them and explain their obligations under the contract, how the timeshare works, and the monthly maintenance fees and costs.
How to Refuse an Unwanted Timeshare as an Heir
You may have been nominated as the heir to a timeshare in a parent’s estate. Although the deceased may have had the best intentions, you may not want to be saddled with ongoing costs. Are you wondering how to get rid of your parent’s timeshare?
Heirs can disclaim inherited timeshare properties, and the process depends on the timeshare’s type.
If the timeshare is a “right to use” timeshare, the executor can inform the timeshare resort developer that the owner died and that the company must take steps to take the timeshare back.
If it is a deeded timeshare or a specific bequest to a designated beneficiary, the named beneficiary should approach the will’s executor and provide them with a written disclaimer of interest. The written disclaimer clarifies that they have no interest in inheriting the property.
The disclaimer is known as a renunciation of property.
During probate, an intended heir should not visit the property or pay its annual fees from a personal bank account. These actions could prevent the heir from disclaiming the property.
The Renunciation of Property Process
If you decide to renounce the timeshare, it’s best to do so without delay. In California, you have a maximum of 9 months to renounce.
Once you have decided to renounce, you need to draw up, sign and submit the renunciation document to the estate executor and send it via certified mail to the timeshare company. You should also send a copy of the owner’s death certificate. It’s a good idea to keep a copy for yourself and to register a copy of the letter with the probate court.
How Timeshare Defense Attorneys Can Assist You
Perhaps you have a timeshare and have considered leaving it to your loved ones but, on second thoughts, have realized that they do not want it or that its ongoing expenses will be a burden for them.
Our lawyers at Timeshare Defense Attorneys can advise you on how to get rid of your timeshare. Our team customizes solutions to meet your unique needs. Contact us today for a free case evaluation.