Preparing an Agreement to Transfer Assets

People have the right to give away or sell their property without restriction so long as they do so without harming the rights of their creditors or the government.  One way of transferring assets is through a transfer of asset agreement.  A transfer of asset contract can be executed at any time and put into effect when someone passes away.

How These Agreements Work

A transfer of assets agreement ensures that a person’s assets are transferred to someone else at the time of the person’s death.  For example, a living trust, a life insurance policy, pension, annuity, or a separate contract can be executed during the creator’s lifetime and the beneficiary of the contract will receive the assets when the creator dies.  Generally, beneficiaries of transfer of asset contracts get their assets much faster than assets that are transferred through a will and must go through the probate process.

Drafting an Agreement

It is important to work with an attorney when drafting a transfer of assets agreement.  Your attorney can ensure that the agreement is properly drafted and executed so that it remains enforceable at the time of your death.  The agreement must specifically state:

• The assets that are being transferred;
• To whom they are being transferred;
• The consideration for the contract; and
• When the assets will be transferred.

Tips on Agreements

The agreement must not violate any state or federal laws, must not be created to defraud creditors or the government, and must be clearly written.  It is also important to periodically review the contract.  For example, many people assign beneficiaries to life insurance policies and retirement accounts when they take new jobs and then they forget about it.  If you have gotten married or divorced since you signed those agreements then it is especially important to review them. In some states, a spouse must consent in writing if you appoint a beneficiary other than your spouse to such assets.

An estate planning attorney can ensure that your transfer of assets contracts meets all of the requirements in your state and that it will be enforceable after your death.  A beneficiary may wish to have an attorney review the contract and make sure that his or her interests are also protected.