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When it comes to planning for the future, many people want to make things as easy as possible for their loved ones. One tool that can help simplify the process is a Transfer-on-Death (TOD) deed. In Texas, TOD deeds allow you to pass real estate directly to a beneficiary without going through probate. Here’s what you need to know about how Transfer-on-Death deeds can affect probate.
What Is a Transfer-on-Death Deed?
A Transfer-on-Death deed, sometimes called a beneficiary deed, is a legal document that lets you name a person (or multiple people) who will automatically inherit your real estate when you pass away. Until that time, you continue to own and control the property just as you always have.
When you pass away, ownership of the property transfers directly to the beneficiary named in the deed, without the need for court involvement.
Texas law recognizes TOD deeds for real property, including homes, rental properties, and land.
How TOD Deeds Help Avoid Probate
One of the main advantages of a TOD deed is that it can allow real estate to transfer outside of probate. This means:
- No court proceedings are required to transfer the title.
- The property does not become part of the probate estate.
- The transfer is faster and often less expensive than traditional probate administration.
This can be especially helpful if the home is one of the estate’s most valuable assets, providing stability for beneficiaries without long delays.
However, it’s essential to know that TOD deeds only affect the specific property named in the deed. Other assets (like bank accounts, vehicles, or investments) may still need to go through probate unless other planning steps are taken.
Key Things to Know About TOD Deeds
While TOD deeds offer some clear benefits, they also come with important rules and limitations:
- You Retain Full Control During Life: You can sell, mortgage, or change your mind about the property at any time. The beneficiary has no rights until after your death.
- They Must Be Properly Recorded: The deed must be signed, notarized, and filed with the county clerk in the county where the property is located before your death.
- Multiple Beneficiaries Are Allowed: You can name more than one beneficiary and specify what happens if one of them passes away before you.
- Creditors Can Still Make Claims: If you have debts when you pass away, creditors may still be able to seek repayment from the property transferred by a TOD deed.
Our firm can help you draft and record a TOD deed properly to avoid problems later.
When a TOD Deed May Not Be Enough
While a TOD deed can be a helpful tool, it’s not a substitute for a complete estate plan. There are situations where relying solely on a TOD deed could create complications, such as:
- If you have complex family dynamics (e.g., blended families, estranged heirs)
- If you want to place conditions on inheritance (which TOD deeds do not allow)
- If significant debts could affect the estate
- If you have multiple valuable assets beyond real estate
In many cases, a TOD deed works best as part of a broader estate planning strategy that includes a will or trust.
Let’s Build a Plan That Works for You
At the Law Office of Carey Thompson, we make estate planning simple, effective, and tailored to your life. If you’re considering a Transfer-on-Death deed or want to learn more about your options for avoiding probate, we’re here to help. Contact our office today to schedule a consultation and start building a plan that protects what matters most.