Gaithersburg, MD asked in Real Estate Law for Maryland

Q: If I sell my Maryland house with a life estate deed WITH power before I die, is the remainderman entitled to anything?

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2 Lawyer Answers
Richard Sternberg
Richard Sternberg
Answered
  • Potomac, MD
  • Licensed in Maryland

A: You need a title abstract and a bit of research. First, you need to know that the house actually purports to be held in a life estate with an unlimited general power of sale. Then, if that is how it is held, I'd want to review whether the Doctrine of Merger combines those two titles into a fee simple. A life estate with a lifetime general power of sale sounds like it would make sense in a second marriage, poor-man's testamentary setting, but I've never heard of using that technique, and it deserves review. The good news is that you might get that quite cheaply in the current market. If a title insurer is willing to write title insurance on it, the buyer will be protected, but you want a lawyer to review the exceptions to make sure the claims by the remaindermen are covered. From your perspective as the life estate seller, you need to either pay for a legal review beforehand or make sure the listing of the house fully discloses the unusual title and that the sale is contingent on clearing title review. Without that, you might be liable to the buyer for failing to produce clear title.

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Cedulie Renee Laumann
Cedulie Renee Laumann
Answered
  • Crownsville, MD
  • Licensed in Maryland

A: No.

Life estate deeds with full powers are used regularly for estate planning in this state and if properly drafted the remainderman has no interest whatsoever until the life tenant dies.

Please note that an attorney cannot realistically answer questions about a specific deed without looking at the deed itself, but very generally life estates are split into two kinds: 1) "without powers" (where the remaindermen need to get involved with any sale/mortgage proposed by the life tenant) and 2) with full powers where the remaindermen aren't involved at all while the life tenant is living.

While not legal advice, I hope this general information helps!

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