A home or piece of land is often the most valuable asset in an estate. In Washington, one way to transfer real estate outside of probate upon death is through a Transfer on Death (TOD) Deed. This type of deed allows property owners to name beneficiaries who automatically receive title to the property when the owner passes away.
At North City Law, our transfer on death deed attorneys help clients in Everett, Mukilteo, Marysville, Lake Stevens, Lynnwood, Arlington, and throughout Snohomish County and beyond decide if this option fits into their estate plan.
If you want to explore whether a TOD deed makes sense for your property, call North City Law at 425-645-4684 to schedule a consultation with our experienced transfer on death deed attorneys.
What Is a Transfer on Death Deed in Washington?
A transfer on death deed, also called a beneficiary deed, is a legal document that lets a property owner name one or more beneficiaries to inherit real estate automatically upon an owner’s death. The owner keeps full control of the property during life, including the ability to sell it, refinance it, or revoke the deed. The beneficiary’s rights only begin after the owner’s death.
What Must Be Included for a Transfer on Death Deed to Be Valid in Washington?
Washington law sets out strict requirements for a transfer on death deed to be legally effective. To be valid, the deed must:
- Contain all of the essential elements and formalities of a properly recordable deed in Washington.
- Clearly state that the transfer of property to the beneficiary will only occur upon the transferor’s death.
- Be signed and acknowledged with the same capacity required to make a will.
- Be recorded with the county auditor’s office in the county where the property is located before the transferor’s death.
Unlike a traditional deed, a TOD deed does not require notice, delivery, acceptance by the beneficiary, or the payment of consideration. The deed is also expressly revocable during the owner’s lifetime, even if it says otherwise.
What Rights Does the Owner Retain During Life?
A transfer on death deed does not limit the transferor’s rights while alive. The owner remains free to sell the property, take out loans, or change beneficiaries by recording a new deed or revocation. Beneficiaries have no present legal interest until the owner passes away.
What Happens to Property Subject to Transfer on Date the Owner’s Death?
At the death of the transferor, title passes automatically to the named beneficiary if all statutory requirements have been met. It’s important to appreciate that the property transfers that are subject to any existing mortgages, liens, or other encumbrances. If multiple beneficiaries are named, they generally take equal shares, and if one beneficiary predeceases the owner, that share lapses unless otherwise provided.
How Does a Transfer on Death Deed Work?
Once recorded, a TOD deed acts like a placeholder. The owner still holds title and can change their mind at any time. At death, the property passes directly to the named beneficiary without going through probate. The beneficiary only needs to file an affidavit of death and supporting documents with the county recorder to update title records.
This process can save time and costs compared to probate, but it must be carefully drafted to meet Washington’s statutory requirements.
What Are the Advantages of a Transfer on Death Deed?
Transfer on death deeds can be beneficial for many Washington property owners because they:
- Avoid probate by transferring real estate directly to beneficiaries.
- Preserve control since the owner retains full rights to use, sell, or revoke the deed during life.
- Provide flexibility by allowing multiple beneficiaries to be named, including individuals, charities, or trusts.
- Reduce costs since recording a TOD deed is typically far less expensive than probate proceedings.
- Maintain privacy by avoiding the public process of probate court.
What Are the Limitations of a Transfer on Death Deed?
Despite its benefits, a TOD deed is not always the best choice. Limitations include:
- No protection from creditors: If debts remain after the death of the decedent, creditors may still pursue claims against the property.
- No tax advantages: TOD deeds do not reduce estate or capital gains taxes.
- Potential conflicts: If multiple beneficiaries are named, disputes may arise about whether to keep or sell the property.
- Interaction with other plans: If a will or trust conflicts with the TOD deed, confusion and litigation may result.
For owners with multiple properties, complex estates, or significant debts, trusts or other planning tools may be more appropriate.
How Do Transfer on Death Deeds Compare to Wills and Trusts?
Unlike a will, which must go through probate, a TOD deed transfers real estate automatically at death. Unlike a trust, however, it applies only to the specific property named in the deed. A trust can handle multiple properties, protect assets, and provide instructions for ongoing management, while a TOD deed is a single-property solution (however and owner can create separate TOD deeds for all property owned).
Many Washington families use a TOD deed as part of a broader estate plan, often in combination with wills and trusts, to cover all assets and minimize risk.
Can a Transfer on Death Deed Be Changed or Revoked?
Yes. If the property owner is alive and has capacity, a TOD deed can be revoked or replaced. This makes it more flexible than outright gifting property during life. The revocation or new deed must also be recorded with the county to be effective.
What Happens If No Beneficiary Survives the Owner?
If all named beneficiaries die before the property owner, the TOD deed fails, and the property becomes part of the owner’s probate estate. This makes it important to name contingent beneficiaries or consider pairing the TOD deed with a will or trust to cover alternate outcomes.
Is a Transfer on Death Deed Right for My Rental Property Portfolio?
For landlords in Snohomish County, TOD deeds may provide a simple way to transfer rental properties without probate delays. However, they do not address issues of control or management. For example, heirs may inherit rental units but lack the ability or desire to manage them. In these cases, a trust or LLC structuremay provide a more effective way to separate ownership from day-to-day control.
How Can The Experienced Transfer on Death Deed Attorneys At North City Law Help With TOD Deeds?
At North City Law, our transfer on death deed lawyers work with clients to determine whether this option fits their estate plan. We draft deeds that comply with Washington law, record them properly, and coordinate them with wills, trusts, and other estate planning tools to avoid conflict.
We help property owners across Everett, Mukilteo, Marysville, Lake Stevens, Lynnwood, Arlington, and all of Snohomish County and beyond to use TOD deeds strategically, whether for a family home or a rental portfolio.
If you are considering a transfer on death deed, call North City Law at 425-645-4684 today to schedule a consultation with a Washington transfer on death deed attorney.