Timeshares can be a source of endless fun and excitement. However, there is another side1)perhaps a bit nefarious of timeshares that cause significant anger and frustration. This can be said for timeshares while the owner is alive and even more so after s/he is deceased.
The complexity and frustration of transferring ownership in a timeshare after death depends on one simple factor, type of ownership.
Timeshares come in two different forms. A significant portion of the first category of timeshares are deeds. This would be similar to a home or condo. When the timeshare was purchased, a portion of the real property where the timeshare sits is deeded to the purchaser.
A smaller percentage of timeshares are in the second category, contractual right to use. For this type, there is not a deed or real property transfer. The owner of the timeshare has a contractual right to use the facility where the timeshare is located according to the time and dates specified in the contract.
Both types present different issues in transferring the interest in the property or the right to the property at the time of the owner’s life. I will first tell you a little more about each type of timeshare, then more importantly, how to avoid the costly probate process with timeshares.
In Nevada, if the timeshare is a deeded interest, then there must be a probate in Nevada in order to transfer the interest to the beneficiaries or heirs of the decedent. For example, if a Decedent was a resident of Ohio and passed away in Ohio, but held interest in a timeshare in Nevada by deed, then the Decedent would have a probate proceeding in Ohio and a separate probate in Nevada. A probate administration established for the sole purpose of transferring an interest in a timeshare is extremely time consuming and expensive, and most importantly, can be avoided.
If the timeshare is a contractual “right to use” and the value of the timeshare is less than $20,000, then in Nevada the beneficiary or heirs of the Decedent can possibly transfer the interest by use of an Affidavit of Entitlement without any court proceedings, with the assumption that there are no other assets in Nevada. If the value is more than $20,000, then it may be necessary for a probate administration to be established. Similar to deeded timeshares, the need for probate can be avoided with contract timeshares.
If you own a timeshare in another state or own more than one parcel of real property in different states, the easiest way to avoid costly probate is to create a revocable living trust. A trust, if funded properly, removes the assets from the jurisdiction of the courts and, upon death, the trust will pass ownership interest to the listed beneficiaries of the trust without court involvement. A trust will alleviate the necessity of creating numerous probates in different states.
If you own a timeshare, it is important to contact an estate planning attorney and put the timeshare in a living trust so you do not inadvertently burden your loved ones. If you have inherited a timeshare, it is important to contact an attorney in the jurisdiction where the timeshare is located to determine your options.
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