Avoiding Probate With A Beneficiary Deed
The probate court system can be avoided if you would like your family or a friend to receive your real property at your death, but you do not want to share title while you are living. A Beneficiary Deed in essence is a "pay on death designation" for real property.
Under A.R.S. Section 33-405, the owner or owners of property can designate "grantees" or recipients of real property which is effective only on the death of the owners.
The Beneficiary Deed is fully revocable until the last owner dies by recording a Revocation of Beneficiary Deed. Therefore, co-owners need to realize that when one dies, the surviving owner could revoke the Beneficiary Deed.
Unlike other deeds, the Beneficiary Deed or the Revocation of Beneficiary Deed will only be effective once it is recorded. The owner retains control. The owner does not need to consult the beneficiaries or be concerned about their creditors (unlike joint tenants).
The Beneficiary Deed is a great tool for people who have all other assets in accounts that have a “pay on death” designation or designated beneficiary. The Beneficiary Deed is not a good tool if you want to leave your real property to more than three people, to minors or to adults with special needs receiving government assistance.