Probate Preferred Over Beneficiary Deed If HOA Transfer Fee

  Question: In a recent column you discussed the advantage of a mother executing and recording a beneficiary deed to her daughter for a Sun City home. The advantage was that the daughter, without the necessity and cost of a probate, would be the owner of the Sun City home upon the mother’s death. In Sun City, however, there is a $4,000 transfer fee paid to the HOA that is generally due upon the transfer of a Sun City home. This $4,000 transfer fee can be avoided by probate of the Sun City home. After the death of the mother, wouldn’t it be cheaper to probate the Sun City home by a small probate affidavit to the daughter?

  Answer: Probably. In general, a major advantage of a beneficiary deed is that the time and cost of probate can be avoided. In light of the Sun City $4,000 transfer fee, however, a transfer of the Sun City home to the daughter after the mother’s death by a small probate affidavit under A.R.S. § 14-3971 should be cheaper than transferring the Sun City home by a beneficiary deed.

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