Purchasing in a 55+ Community - AZ

Tens of thousands of dollars involved here and you are asking for Arizona estate planning advice on a continent wide RV forum?

In California BAD idea to add kids to anything substantial. If they are at fault in an auto accident guess what one of their assets are? Their part of “your” RV/park model trailer.

When my Dad passed away, we had to get a lawyer involved to take his name off the title to the house and make my mother the soul owner. My sister and I were added to the title TOD (transfer on death). We had no interest in the property until she died. When we sold the house, there was no question the house had become ours when my Mother died and we signed the title over to the buyer. The value of the house to use was what it was worth on the day she passed away. She had some stock and we were on that TOD also. Our base value was what the stock sold for at close on the day of her death. You can use TOD on any title - houses, cars, stock. The names listed after TOD have no ownership until the primary owner dies. No lawyer or courts needed.

DFord wrote:
When my Dad passed away, we had to get a lawyer involved to take his name off the title to the house and make my mother the soul owner. My sister and I were added to the title TOD (transfer on death). We had no interest in the property until she died. When we sold the house, there was no question the house had become ours when my Mother died and we signed the title over to the buyer. The value of the house to use was what it was worth on the day she passed away. She had some stock and we were on that TOD also. Our base value was what the stock sold for at close on the day of her death. You can use TOD on any title - houses, cars, stock. The names listed after TOD have no ownership until the primary owner dies. No lawyer or courts needed.

Thank you. That seems incredibly straight forward. Can a 55+ HOA restrict ownership? We think that they have legal standing to restrict residency (which the they understand until they turn 55) but we feel like they could still own the property and rent it out (assuming good w/ HOA) until they can snowbird at their retirement.

Does that make sense or am I way off?

In Texas a park model is a vehicle (trailer) and not real property. There is no deed. It may be the same in Arizona.

I think you are right. What if there is land ownership in addition to the park mod? Does that matter?

Suggest you speak to the board of the HOA to get their take on what you want to do. As you've already suggested, they'll be involved at some point, so why not get the official answers you seek, before jumping in?
If it were me, I'd simply will/transfer on death the ownership to the kids, as others have suggested, and let them deal with it. Give them a heads up, too.

DFord wrote:
When my Dad passed away, we had to get a lawyer involved to take his name off the title to the house and make my mother the soul owner. My sister and I were added to the title TOD (transfer on death). We had no interest in the property until she died. When we sold the house, there was no question the house had become ours when my Mother died and we signed the title over to the buyer. The value of the house to use was what it was worth on the day she passed away. She had some stock and we were on that TOD also. Our base value was what the stock sold for at close on the day of her death. You can use TOD on any title - houses, cars, stock. The names listed after TOD have no ownership until the primary owner dies. No lawyer or courts needed.

This is especially nice on bank accounts (referred to as POD). After the person passes, all you have to do is show up with a death certificate and ID. It is outside of any will (but part of the estate for tax purposes) and the bank pays immediately.

AZ has no law that prohibits the owner of real property from being under 55 in a age restricted community. HOA's may also be limited on their ability to impose such restrictions as ownership and occupancy are two separate issues under ARS. I know many in AZ age restricted communities that have younger family members as owners but who can't legally reside in what they own.

Because there is mass confusion among people in these communities over the various laws, HOA rules, property ownership versus land leasing versus rental and everyone knows someone who has or has not been able to do what you ask, I strongly suggest you speak with a lawyer who knows AZ laws on age restricted communities.

One of the kids suggested investing in a percentage of the purchase price...would that matter at all in terms of how things would appear on a deed?

I am an attorney, although not in Arizona and state laws can differ.

First, the proper way for property to pass on from one co-owner to another after death is for the property to be titled with the names of the co-owners listed as joint tenants in common with rights of survivorship. That way, the property stays out of any probate and need not be listed in a will.

Second, listing children's names on any asset is NOT the way to transfer property after death. That makes anything you own theirs and vice versa. If a child declares bankruptcy, then your asset becomes theirs to pay off creditors. If one of the children has an at fault accident with damages that exceed their insurance, your asset will be seized. Upon death, the children loose the one time step up in basis to figure capital gains taxes. It is just all around a bad idea.

HOA covenants are fully enforceable, and sometimes have more teeth than any local laws because they are agreements that both parties have willingly entered into. I bet the HOA covenant does not prohibit any aged person owning property in the development, but rather prohibits under aged 55 residing in the development except for short visits that are thoroughly explained.

My personal non legal advice to the OP is to buy whatever asset you want, be it a car, RV, any real property, or this 55+ development and title it in you and your spouse's name with real property listed as joint tenants in common with rights of survivorship. Then specify in your will how all of your assets will be disposed of upon your death.