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What you should know about Texas transfer on death deeds

Your most valuable assets will usually be your biggest priority when planning your estate. It’s likely that you don’t own anything worth more than your home. Real estate is quite valuable, making it an important asset to address while planning your estate.

Some people want to sell the house so their loved ones can have the money from the property. Others want a specific family member to receive the property. There are numerous ways to transfer real estate as part of your estate. One of the options available in Texas is the creation of a transfer on death deed (TODD).

How does a TODD affect estate administration?

If you create a TODD, the ownership of your home passes directly to someone else after you die, allowing your loved ones to keep your house out of probate proceedings. There are numerous other ways to avoid the probate court managing the transfer of your home after your death, but many of them require changes to ownership while you are still alive.

For example, moving the property into a trust is a common solution, but it is one that may increase your property tax costs. Using a TODD means that you are the owner of record up until you die, at which point someone else will be able to register the pre-existing deed and quickly change the title records for the property.

What are the issues with using a TODD?

One of the risks of executing a deed long before you die to avoid probate proceedings affecting your home is that someone could misplace the physical document that would transfer the property to your family members.

Without the actual deed, your planning will come to nothing. Some people bypass this concern by having their attorney retain the deed. Additionally, unlike moving a property into a trust, having a deed for transfer after you die will not protect your property from claims by creditors while you are alive.

The benefits of a transfer on death deed include retaining complete control over the property and the ability to name multiple people or even a business as the recipient of the property. Exploring different ways to manage your biggest assets while estate planning in Texas can help you create documents that will protect you and benefit your family.

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