What does divorce mean for a TOD beneficiary?

[innerscension]

Good evening all. I'm trying to help out a dear friend of mine going through a rough time that is worried about what is going to happen to her parent's house she now lives in with her soon to be former spouse.

She is named as a beneficiary in her mother's TOD affidavit. What impact if any will that have in the court's decision on who gets the house? I know some remodeling was done to parts of the house while they've been there - will that money invested have any impact either? Does she and her spouse automatically have "beneficial interest" because they live there (to say nothing of the money spent on home improvements)? I'm worried that both her and her mom may lose their cozy home of many years to a bitter ex-spouse.

She lives in the state of Ohio.

Thanks for any and all advice!

 

[LdiJ]

Good evening all. I'm trying to help out a dear friend of mine going through a rough time that is worried about what is going to happen to her parent's house she now lives in with her soon to be former spouse.

She is named as a beneficiary in her mother's TOD affidavit. What impact if any will that have in the court's decision on who gets the house? I know some remodeling was done to parts of the house while they've been there - will that money invested have any impact either? Does she and her spouse automatically have "beneficial interest" because they live there (to say nothing of the money spent on home improvements)? I'm worried that both her and her mom may lose their cozy home of many years to a bitter ex-spouse.

She lives in the state of Ohio.

Thanks for any and all advice!

Who legally owns the house?...and explain exactly what you mean by TOD affidavit...what does that cover?

 

[mistoffolees]

Good evening all. I'm trying to help out a dear friend of mine going through a rough time that is worried about what is going to happen to her parent's house she now lives in with her soon to be former spouse.

She is named as a beneficiary in her mother's TOD affidavit. What impact if any will that have in the court's decision on who gets the house? I know some remodeling was done to parts of the house while they've been there - will that money invested have any impact either? Does she and her spouse automatically have "beneficial interest" because they live there (to say nothing of the money spent on home improvements)? I'm worried that both her and her mom may lose their cozy home of many years to a bitter ex-spouse.

She lives in the state of Ohio.

Thanks for any and all advice!

Since there's a TOD, I'm assuming that her mother owns at least part of the house. Her mother's portion can not be distributed in the divorce. Even if Mom dies before they divorce, it would be an inheritance and not marital property.

Please tell us how the house is titled. If Mom owns 100%, then hubby would not be entitled to anything. If Mom and daughter each own 50%, then hubby would be entitled to 25% (half of wife's share) of the equity. It is extremely unlikely that hubby would keep the house in a divorce. Even in the latter case, wife would almost certainly have the option to pay him for his share and keep the house.

Now, there may be some complexity in getting him to leave. The easiest way is for wife to request exclusive use of the marital home when they divorce. If her mother owns 100%, she may be able to evict him, as well (although she might have to evict both of them and then let the daughter move back in).

In any event, there are too many variables. Tell us who owns the house and that will narrow it down.

 

[nextwife]

Whose funds were used to improve the property, if the wife has some ownership interest? WAs marital money used?

 

[Ohiogal]

Whose funds were used to improve the property, if the wife has some ownership interest? WAs marital money used?

If this is a TOD deed then the wife doesn't have ANY current ownership interest in the home. The wife ONLY gets an ownership when her mother dies and then the house transfers DIRECTLY to her upon death.

 

[mistoffolees]

If this is a TOD deed then the wife doesn't have ANY current ownership interest in the home. The wife ONLY gets an ownership when her mother dies and then the house transfers DIRECTLY to her upon death.

Is it not possible for Mom and daughter to each have 1/2 ownership and for the TOD to transfer only Mom's portion to the daughter on death?

As I read the law, you can use a TOD, even if you own only part of a property:
Lawriter - ORC - 5302.22 Transfer on death deed form.

(B)Any individual who, under the Revised Code or the common law of this state, owns real property or any interest in real property as a sole owner , as a tenant in common, or as a survivorship tenant, or together with the individual’s spouse owns an indivisible interest in real property as tenants by the entireties, may designate the entire interest, or any specified part that is less than the entire interest, in that real property as transferable on death to a designated beneficiary or beneficiaries by executing , together with the individual’s spouse, if any, a transfer on death designation affidavit as provided in this section .

If you're correct and that's not possible, then OP's friend has nothing to worry about. Being beneficiary does not confer any ownership interest. And even if Mom dies before the divorce is final, the house would be an inheritance and not subject to property division.

OTOH, if my interpretation is correct and the TOD does not prove that Mom is the sole owner, then we need to know the exact details of who currently owns the property.

For educational purposes, here's a good summary of TOD deeds (which are no longer being issued):
Ohio Eliminates Transfer on Death Deeds - Law Firm Budish, Solomon, Steiner & Peck, LTD Attorneys Beachwood, Ohio

 

[Ohiogal]

Is it not possible for Mom and daughter to each have 1/2 ownership and for the TOD to transfer only Mom's portion to the daughter on death?

As I read the law, you can use a TOD, even if you own only part of a property:
Lawriter - ORC - 5302.22 Transfer on death deed form.


If you're correct and that's not possible, then OP's friend has nothing to worry about. Being beneficiary does not confer any ownership interest. And even if Mom dies before the divorce is final, the house would be an inheritance and not subject to property division.

OTOH, if my interpretation is correct and the TOD does not prove that Mom is the sole owner, then we need to know the exact details of who currently owns the property.

For educational purposes, here's a good summary of TOD deeds (which are no longer being issued):
Ohio Eliminates Transfer on Death Deeds - Law Firm Budish, Solomon, Steiner & Peck, LTD Attorneys Beachwood, Ohio

You can use a TOD if you OWN part of the property However you wouldn't be TOD'ing to the other joint owner. You would be tenants in the entirety or joint tenants with right of survivorship.

The TOD is used to confer YOUR portion of the ownership to someone NOT in title.

 

[mistoffolees]

You can use a TOD if you OWN part of the property However you wouldn't be TOD'ing to the other joint owner. You would be tenants in the entirety or joint tenants with right of survivorship.

The TOD is used to confer YOUR portion of the ownership to someone NOT in title.

That's not what the above statute seems to imply (although it's somewhat complicated by the fact that TOD deeds are no longer issued and TOD affidavits are issued instead).

transferable on death to a designated beneficiary or beneficiaries by executing , together with the individual’s spouse, if any, a transfer on death designation affidavit as provided in this section

I don't see anything that precludes using it to transfer your share of a deed to anyone you wish - regardless of whether they are already part owners. Real estate law is sort of strange. If you own half of a house, that ownership is treated as a completely separate and independent entity with absolutely no bearing on who owns the other half - with some types of ownership.

 

[nextwife]

Is it not possible for Mom and daughter to each have 1/2 ownership and for the TOD to transfer only Mom's portion to the daughter on death?

As I read the law, you can use a TOD, even if you own only part of a property:
Lawriter - ORC - 5302.22 Transfer on death deed form.


If you're correct and that's not possible, then OP's friend has nothing to worry about. Being beneficiary does not confer any ownership interest. And even if Mom dies before the divorce is final, the house would be an inheritance and not subject to property division.

OTOH, if my interpretation is correct and the TOD does not prove that Mom is the sole owner, then we need to know the exact details of who currently owns the property.

For educational purposes, here's a good summary of TOD deeds (which are no longer being issued):
Ohio Eliminates Transfer on Death Deeds - Law Firm Budish, Solomon, Steiner & Peck, LTD Attorneys Beachwood, Ohio

That's what I thought as well. IF mom has some partial interest now, and marital funds paid for improvments, it is possible they for whatever reason used TOD deed for mom's interest. Perhaps they already held title as Tenants in Common, and mom later decided she wanted daughter to get her share at death and decided to accomplish it that way. I see lots of convaluted approaches to estate planning.

Why doesn't daughter simply offer to pay ex back if he paid through settlement for improvements if she doesn't want him to have any interest? If I were keeping a house, I'd consider that only fair. OF course, that is if it was not her sole funds that paid for the improvemen ts.

 

[mistoffolees]

That's what I thought as well. IF mom has some partial interest now, and marital funds paid for improvments, it is possible they for whatever reason used TOD deed for mom's interest. Perhaps they already held title as Tenants in Common, and mom later decided she wanted daughter to get her share at death and decided to accomplish it that way. I see lots of convaluted approaches to estate planning.

That certainly looks like a possibility.

Why doesn't daughter simply offer to pay ex back if he paid through settlement for improvements if she doesn't want him to have any interest? If I were keeping a house, I'd consider that only fair. OF course, that is if it was not her sole funds that paid for the improvemen ts.

Before offering that advice, I'd like to hear back from OP {crickets chirping} about how the home is currently titled. If the home is entirely in the Mom's name, then any improvements they made are a gift - or possibly considered a payment in lieu of rent. It's not clear at all that OP's friend owes stbx anything.

 

[LdiJ]

That certainly looks like a possibility.



Before offering that advice, I'd like to hear back from OP {crickets chirping} about how the home is currently titled. If the home is entirely in the Mom's name, then any improvements they made are a gift - or possibly considered a payment in lieu of rent. It's not clear at all that OP's friend owes stbx anything.

I would look at it that way also if the deed is solely in mom's name.