Lady Bird Deed or Joint Owner? Comparing the Two Ways to Pass Down a Florida Home

Dolores's Question: Add Kim to the Deed, or Use a Lady Bird Deed?

Dolores is 80, lives in Ormond Beach, and has owned her home for decades. She wants her daughter Kim to inherit the house without probate, without a lawyer, without any fuss. A well-meaning friend told her the simplest way to do that is to add Kim to the deed as a joint owner with right of survivorship. Dolores is a composite of the kind of client I see often in my practice, not an actual person I've represented, but her situation is a common one.

A quick note on the basics, since Truestead covers them in depth elsewhere: with a Florida lady bird deed, the owner keeps full control for life, including the right to sell or revoke the deed at any time, and the property passes to the named beneficiaries at death without probate. The real question for Dolores is whether joint ownership gets her to the same result more simply, or whether it creates problems a lady bird deed avoids. I find it easiest to walk through her five actual worries, one at a time.

Worry #1: Will Kim Avoid Probate?

Joint ownership: Yes. Property titled as joint tenants with right of survivorship passes automatically to the surviving owner at death, outside of probate.

Lady bird deed: Also yes. The named remainder beneficiary receives the property at Dolores's death by operation of the deed itself, with no probate required.

Winner: Tie. Both methods get Kim out of probate court. This is the one worry where joint ownership and a lady bird deed perform identically, which is exactly why so many families assume the two options are interchangeable. They are not, as the next four worries show.

Worry #2: Will the Home Be Exposed to Kim's Creditors?

Joint ownership: Adding Kim to the deed is a present gift of an ownership interest, not a future promise. The moment Kim's name goes on the title, she owns a real share of the house today, and that share is reachable by her creditors today. If Kim is ever sued, falls behind on debts, or has a judgment entered against her, a creditor can potentially attach her interest in Dolores's home. Because Kim does not live there as her permanent residence, her share generally will not qualify for Florida's homestead creditor protection, even though Dolores's own share does.

Lady bird deed: Kim receives nothing until Dolores passes away. She has no present ownership interest for a creditor to reach while Dolores is alive, because a lady bird deed grants only a future interest that can still be changed or revoked.

Winner: Lady bird deed. This is often the single biggest reason families choose it over joint titling.

Worry #3: What if Kim Goes Through a Divorce?

Joint ownership: Because Kim's interest is a present asset, it can become part of the conversation in a divorce or equitable distribution proceeding, and in some circumstances could be treated as a marital asset subject to a spouse's claim, depending on the facts.

Lady bird deed: Since Kim owns nothing until Dolores's death, there is no present interest for a divorce court to divide while Dolores is living.

Winner: Lady bird deed.

Worry #4: Can Dolores Sell or Refinance Later Without a Hassle?

Joint ownership: Once Kim is a joint owner, Dolores generally cannot sell, refinance, or mortgage the property without Kim's signature and agreement. If Kim is unavailable, uncooperative, or her interest has been affected by a lien, that complicates or blocks a sale entirely.

Lady bird deed: Dolores keeps the unilateral right to sell, mortgage, or even change her mind and name someone else as beneficiary, all without asking Kim's permission or getting her signature.

Winner: Lady bird deed, clearly. For a homeowner like Dolores who may want to downsize, move closer to family, or simply keep her options open, this difference matters as much as anything on this list.

Worry #5: What About Medicaid, If Dolores Ever Needs Long-Term Care?

Joint ownership: Adding Kim to the deed is generally treated as a gift for Medicaid purposes, and gifts made within Medicaid's five-year lookback period can delay eligibility for long-term care benefits.

Lady bird deed: Because Dolores retains full ownership and control during her lifetime, a lady bird deed is generally treated as a non-transfer for Medicaid lookback purposes.

Winner: Lady bird deed. This is a meaningful consideration for any Florida homeowner in their 70s or 80s, since none of us can predict whether long-term care will become necessary.

One More Thing Dolores Should Ask: Is the House Homestead, and Is She Married?

Florida's homestead protections add another layer worth understanding, even though they did not change the outcome for Dolores. Because Dolores has not given up ownership under a lady bird deed, her home generally keeps its homestead exemption and Save Our Homes assessment cap during her lifetime. If Dolores were married, Florida's constitution requires a spouse to join in any conveyance or devise of homestead property, so that requirement applies whether the family chooses joint ownership or a lady bird deed. Any Florida deed, including a lady bird deed, must be signed in the presence of two witnesses, acknowledged before a notary, and recorded in the county where the property sits, here, Volusia County.

Sources

• The Florida Bar Journal, Florida Bar Uniform Title Standards 6.10-6.12, January 7, 2019
• The Florida Bar Journal, Co-ownership and creditor exposure in Florida real property, May 17, 2019

This article is for general informational purposes only and does not constitute legal advice, nor does reading it create an attorney-client relationship. Florida estate, elder, probate, and real estate law are fact-specific and change over time. Consult a licensed Florida attorney about your individual circumstances. Arthur Simpson, Esq. is licensed to practice law in the State of Florida. Attorney advertising.