Land held by a life estate?

Question

I only just recently learned what a 'life estate' is and why someone would do that. But I came across some raw land that is up for tax sale that the title is held by 'John Doe Life Estate'. So I'm wondering why anyone would do that and what sort of rights they would have anyway?

I read back through the last dozen or so forums about life estates and it is always about letting an elderly relative stay in a house until they die. Why would you give them rights to raw land until they die? Hunting?

I think if I bought at tax sale the life estate would not matter because sure they could go wander around on it if they wanted but it wouldn't matter. This is fairly remote land only suitable for harvesting timber or hunting.

It looks like the life estate was granted in the 80's and my county does not have records online that far back so I can't look up the original document.

Anyone have experience with this?

Ned Carey · Answer

If you are an investor it doesn't matter why they did it.

The fact it is a life estate means there is a slightly higher probability you will get the property via tax lien foreclosure or they will not redeem a tax deed before any redemption period ends. There is a good chance the original life estate owner is dead at this point, and the remainderman may not care about the property.

Presuming you want to buy this, you have two choices

• bid at the tax sale
• try to buy directly from the owner before any tax sale transfer of owner ship is completed. This will take some research on your part and /or paying for some title work.

Josh Carr · Answer

The land would be good for the investment and could be used later as a down payment towards another property of greater value, building on it, selling it at the market value, etc.

Wikipedia says this:

In legal terms a life estate is an estate in real property  that ends at death when ownership of the property may revert to the  original owner, or it may pass to another person. The owner of a life  estate is called a "life tenant".

The ownership of a life estate is of limited duration because it ends at the death of a person.