If you own your home, you'll probably want to take steps to keep your house—likely one of your most valuable assets—out of probate when you die. A living trust works well, but you might not want to go to the trouble and expense of creating one. Here's good news: Most states now offer transfer-on-death deeds (TOD deeds), an easy and effective alternative for transferring real estate upon your death.
What Is a Transfer-on-Death Deed or Beneficiary Deed?
A TOD deed is like a regular deed used to transfer real estate, with a crucial difference: Instead of taking effect immediately, a TOD deed doesn't take effect until your death. In some states, this deed is called a "beneficiary deed" because it's a deed that names the beneficiary of the property when you die.
Advantages of TOD Deeds:
Transfer-on-death deeds protect your property from probate.
TOD deeds are fairly easy to create.
You can change your mind at any time and revoke the TOD deed.
After your death, it's usually a simple process for beneficiaries to transfer the property title to themselves—there's no need to go through probate, saving the beneficiaries time and money.