Transfer on Death Deed in Texas: How It Works

What it takes

• A written deed that names the beneficiary and states that the transfer takes effect at your death.
• Signed by you with the same capacity needed to make a will.
• Acknowledged before a notary.
• Recorded with the county clerk where the property is located before you die.

You do not need the beneficiary's consent, and no consideration is required.

What you keep

While you are alive, a TOD deed does not transfer any present interest. You can live in the property, sell it, borrow against it, or lease it. The beneficiary has no rights until your death. You can revoke the deed by recording a revocation, a new TOD deed, or a will that expressly revokes it, following the formalities in the statute.

At your death

The beneficiary records an affidavit with a copy of the death certificate, and title passes to them without probate. They take the property subject to existing liens such as a mortgage, and subject to claims of the decedent's creditors and others with rights, such as a surviving spouse with homestead rights. If a beneficiary dies before you and no backup is named, the property may end up in probate.

Pitfalls

• No backup beneficiary. Name a contingent beneficiary in the deed.
• Multiple beneficiaries. Co-owners can disagree about selling.
• Conflict with a will or trust. A recorded TOD deed controls over inconsistent will provisions in many cases, so coordinate the documents.
• Minor beneficiaries. A child cannot manage real estate, so a guardianship or trust may be needed.
• Medicaid and benefits. A TOD deed may affect eligibility or estate recovery, so ask before you sign if long-term care is likely.

TOD deed or trust

A TOD deed is a simple, inexpensive way to handle one property when your situation is straightforward. A trust is better for several properties, young beneficiaries or incapacity planning. See living trust vs transfer on death deed.

Frequently asked questions

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