Most people are not aware that having a time share can create some estate planning issues. The main problem occurs with ones which are located out of the state where you reside, which is the norm. You may have a time share in Florida, Aruba, South Carolina, wherever. It does not matter. Typically, a time share is considered real property. As such, it means that when you pass away, your heirs will need to probate your will or administer your estate in the state where you reside, but then will need to probate it again in the state where the time share is located. Of course, if the time share is located outside of the United States, that becomes an increasingly complicated matter.
What is the solution? Establishing a revocable living trust and transferring the time share into the trust will avoid probate, at least with respect to property you transfer into it. This usually involves the preparation and recording of a new deed showing the transfer. Another option, which is probably a better one for times shares located outside the U.S., is to add one or more joint owners to the deed, as owners with rights of survivorship. Generally speaking, putting your children’s names, or the names of another family member, on your assets is a bad idea. If that child gets sued or divorced, the property could be at risk. You would also need that child’s consent to dispose of the time share or make changes to it. If the time share is not very valuable, it is certainly an option, especially if the time share is not located in the United States.
Of course, before transferring a time share to a trust or adding an additional owner, one should seek legal counsel to see what is the best option, given one’s particular situation.