An individual who has a life estate interest in property will usually have a deed,
will, or other written document which shows the individual's ownership interest.
However, a life estate or other interest in land may exist even in the absence of
a written document. Although every state in our region requires that the sale of land
or interest in land must be in writing, the states usually recognize exceptions to
this requirement if certain factors are present. These factors are not exactly the
same in all states and are not always weighted equally. But it is generally true that
an oral or informal agreement to transfer any interest in land creates an ownership
interest if the individual claiming ownership (1) proves that the individual has possession
of the land, (2) has made partial payment of the purchase price and (3) has made valuable
improvements on the property.
Most SSI situations involving equitable life estates occur when the SSI individual
sells property to someone else and both parties agree they intended for the seller
to retain a life estate interest, despite the fact that it was not mentioned in the
deed. An agreement by the parties eliminates the need to establish any of the requirements
If an SSI recipient alleges a life estate interest in property (real or personal)
based on an oral or informal agreement (this includes written or notarized statements
that are not recorded), one must develop whether an equitable life estate exists.
If the existence of an equitable life estate is based on one of the two situations
discussed in B below, the determination may be made in the district/branch office.
All other cases must be referred to the Assistant Regional Commissioner, Programs,
ATTN: Assistance Programs Branch, for an opinion from the regional attorney.