Texas Transfer on Death Deeds

Texas Transfer on Death Deeds

The Texas legislature enacted the Texas Real Property Transfer on Death Act which provides Texans an opportunity to transfer real property and avoid probate. As of September 1, 2015, Texas law allows an individual to create a transfer on death deed (TODD). A TODD is made inter vivos (during one's lifetime) and allows an individual to transfer their interest in real property to one or more beneficiaries immediately upon the transferor's death. Tex. Est. Code § 114.051 (West 2017).

Chapter 114 of the Texas Estates Code requires that all transfer on death deeds be written, signed, notarized, and recorded in the county clerk's office of the county where the property is located. Tex. Est. Code § 114.055 (West 2017). To be effective, a TODD must be recorded before the transferor's death and must state that the beneficiary will only acquire an interest in the real property upon the death of the transferor. Id. The Estates Code provides optional forms with specific instructions for transfer on death deeds. The following is an example of conveyance language that might be used in TOD deed;

"At my death, I grant and convey to the primary beneficiary or beneficiaries my interest in the property, to have and hold forever. If at my death I am not survived by any primary beneficiary, I grant and convey to the alternate beneficiary or beneficiaries, if designated, my interest in the property, to have and hold forever. If the primary and alternate beneficiaries do not survive me, this transfer on death deed shall be deemed canceled by me."


Tex. Est. Code § 114.151 (West 2017). As the above language states, an alternate beneficiary should be designated in the event that the primary beneficiary does not survive the grantor or in the event that the primary beneficiary disclaims their interest to the real property. If the grantor chooses to designate more than one primary beneficiary, the property is being granted to each beneficiary in equal shares.

If the only asset a person has is real property, a TOD deed may be a more cost-effective method of transferring title upon death while avoiding the additional expense and time associated with probate. It is often advisable for a will to be made as well; however, if a TOD deed and a will coexist leaving the same real property to different beneficiaries, the TOD deed will supersede the will. Tex. Est. Code § 114.057 (West 2017). Any subsequent written and recorded TOD deeds will replace previous deeds. Id.

TOD deeds are revocable at any time before the transferor's death, which means that the owner of the real property can designate new beneficiaries at any time and for any reason. Tex. Est. Code §§ 114.052; 114.101 (West 2017). To acquire an interest in the real property, the beneficiary must survive the transferor by 120 hours and will assume the real property subject to all mortgages, liens, judgments, and encumbrances allowing any creditor to satisfy their claims. Tex. Est. Code §§ 114.103; 114.104 (West 2017). Conversely, a designated beneficiary that does not wish to inherit the real property for any reason may disclaim all or part of their interest. Tex. Est. Code § 114.105 (West 2017).

Unlike other deeds that transfer real estate, TOD deeds do not affect an owner's right to use, sell, or convey the property during their lifetime. Tex. Est. Code § 114.101 (West 2017). If the owner sells the property after recording a TOD deed, the TOD deed is automatically revoked. The single greatest advantage to TOD deeds is that they allow title transfer of real property without probate. For more information regarding transfer on death deeds and how to utilize them in estate planning, contact a competent real estate attorney.

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