Life Estates in Texas Real Estate: Formation, Rights, And Duties
In Texas there is a limited transfer called a life estate. This transfer is limited in duration by a life. Due to the limited nature of such a transfer, a life estate brings with it a number of unique rights and duties.
The Basics Of A Life Estate In Texas
A life estate is most commonly granted for the life of the grantee. The grantee receives a possessory interest in the estate until the death of the measuring life. At that time, the interest reverts back to either the original grantor or to a third party, called a remainderman.
In Texas, no particular or specific words are required to create a life estate, as long as there is clear intent that a life estate is to be created. Common phrases indicating the creation of a life estate include “for life” or “until his/her death.” Due to the nature of a life estate, a life tenant has certain rights and duties unique to this form of ownership.
Rights Of A Life Tenant
A life tenant in Texas has the following rights:
- The right to possession of the property: Even though a life tenant is not the only party who has an interest in the property, the life tenant has the exclusive right to possession, management, and control of the property.
- The right to all rents and profits during possession: If the property produces income, the life tenant has the exclusive right to it. This includes royalties from an oil and gas well if a producing well was in existence at the time the life estate was granted.
- The right to sell, lease, mortgage, or otherwise alienate the life estate in the property. This right is still limited by the measuring life. For example, a life tenant may lease the property for the duration of the measuring life only.
- The right to invoke Texas homestead law, If applicable.
Duties Of A Life Tenant
While in possession of the land, a life tenant owes the following duties to future interest holders:
- The duty to pay ordinary taxes on the land and interest on a mortgage: A life tenant has a duty to pay taxes to the extent the property produces income. A life tenant is also responsible for interest payments on the properties mortgage, but not the principle.
- The duty not to commit waste: The most significant duty of a life tenant is that they may not use the property in such a way as to decrease the value of the property. In general, this requires that a life tenant exercise the ordinary care of a prudent person to preserve and protect the estate.
If you have any questions about a life estate, contact attorney Cynthia Fronterhouse.