A timeshare is a property that is jointly owned by several people, allowing the owners to enjoy the property on a schedule while sharing the overall cost. Most time-sharing agreements are for vacation homes that an owner can use a certain amount of time each year. Timeshares allow those who enjoy travel to benefit from having a vacation home without being solely responsible for its maintenance, but when the time comes to create an estate plan, timeshares can make your situation more complex. Timeshares are often difficult to sell, especially if they are located in a country outside of the United States. Being aware of ways to handle timeshares when estate planning can reduce some of the confusion and help make things easier for your heirs.
Research Local Laws
Where the timeshare is located could play a crucial role in the way it is included and handled in your estate plan. In certain states, if the timeshare is a deeded interest, probate has to occur in the state where the timeshare is located. This means the estate will have to deal with the added costs associated with ancillary probate. Depending on the value of the timeshare and the exact phrasing in the contract ,it may be possible to avoid these extra court proceedings, but doing your homework before you create an estate plan could save your heirs a lot of time.
Plan for Fees
No matter what type of timeshare a person has, he or she is obligated to pay fees in order to maintain the timeshare. After you pass away, it is important that your estate continues to pay these fees in order to avoid additional problems. Depending on the situation, a timeshare can change hands multiple times, being transferred from you to your estate then to your heir or a potential buyer. If your heir does not want the timeshare and refuses the inheritance, then your estate must continue paying the fees. Make sure your estate is able to afford these fees because failure to pay could lead to foreclosure, ultimately causing more problems for your executor, estate, and beneficiaries.
Consider a Living Trust
One way to transfer a timeshare without creating confusion or costing your estate money is to create a revocable living trust for all of your assets. After a trust is created, you will be able to transfer your timeshare interest into the trust, making the trust the legal owner of your timeshare. This allows you to continue using your timeshare while protecting your heirs after you pass. When a living trust is created, the trust will retain ownership of the timeshare interest even after you pass away, the timeshare interest can still be transferred to your beneficiary, and probate is not necessary.
Explore Your Options
As one of the largest generations in the history of the United States reaches retirement age, issues regarding the transfer of timeshares are becoming more common. Beneficiaries are finding themselves left in control of a property they do not know how to transfer or sell. If you own a timeshare that you would like to include in your estate plan, the trust administration lawyers at MMZ Law are here to offer you legal advice. We are available to answer your questions and work with you to come up with a solution that you feel will best serve your family. Contact our Claremont, California office today to schedule an appointment so that we can begin giving you the legal advice you deserve.
BROUGHT TO YOU BY:
MMZ LAW, A PROFESSIONAL CORPORATION
341 W. 1st St. Suite 100
Claremont, CA 91711
MARIVEL M. ZIALCITA is the founder of MMZ LAW, A Professional Corporation, where she practices in the areas of Elder Law – Medi-Cal Planning Asset Protection, Trust & Estate, Special Needs, Conservatorship, Trust Administration, & Probate. Ms. Zialcita is a frequent speaker on trust and estate matters and holds memberships in the State Bar of California, Trust and Estate Section, The San Bernardino County Bar Association, Wealth Counsel and Elder Counsel. She currently assists in the pro bono legal services program at the James L. Brulte Senior Center in Rancho Cucamonga, California. She is based in Claremont but assists clients throughout Southern California.
This information is educational information only and not legal advice.