If the grantor of a life estate names a third party to receive the title when the life tenant dies, what does the third party hold?

When the grantor of a life estate specifies a third party to receive the title upon the death of the life tenant, that third party holds what is known as a remainder estate. This arrangement creates a future interest in the property, which will become possessory after the life tenant passes away.

The remainder estate is contingent upon the life tenant's life and is a form of vested interest that ensures the third party will receive full ownership rights when the life estate terminates. In contrast, a leasehold estate conveys limited rights for a specified term, while a life estate itself refers to the rights of the individual currently living in the property, not the future interest holder. A fee simple absolute represents the highest form of ownership in real estate, where the owner has complete control and ownership rights, which is not applicable to the arrangement in question involving a remainder. Thus, the correct answer reflects the legal concept of a remainder estate, highlighting the designated future ownership interest following the termination of the life estate.