This is the next article in our series on the types of real estate deeds in Oklahoma.  In the last post, we discussed the quitclaim deed, and its advantages and disadvantages.  In this article, we will answer several questions pertaining to the transfer on death deed.

What is a Transfer on Death Deed in Oklahoma?

Transfer on death deed, known as TODD in short, is a legal document used to transfer real property to another.  Under Oklahoma law, a transfer on death deed allows the record owner to transfer his interest in the property to a beneficiary without going through probate.  The TOD deed is executed during the owner’s lifetime, and, as the name suggests, the transfer is effective only upon the owner’s death.  O.S. 58 §1252.

The transfer on death (TODD) document must clearly identify the property interest being transferred, bear the signature of the record owner, and specify the beneficiary or beneficiaries.  No monetary payment or consideration is necessary for the deed to be valid.  A transfer on death allows the owner to effectively transfer his interest in land, including surface rights, mineral rights, structures, or fixtures to the beneficiary without a need for financial exchange.  O.S. 58 §1252.

Does Oklahoma recognize transfer on death deed?

Yes, Oklahoma recognizes transfer on death deed under the Nontestamentary Transfer of Property (NTP) Act.  O.S. §1251 to §1258.  Under the law, a grantor can make a non-probate transfer of real estate to a grantee, where the interest will only vest after the death of the grantor.

The record owner (grantor) may revoke such transfer at any time before his death to one or all grantee beneficiaries.  Such revocation does not require the owner to obtain a signature, consent from the beneficiary grantee, or otherwise give any sort of notice.  The owner may do so by simply executing, acknowledging, and recording a revocation with the county clerk in the county where the property is located.

How does a transfer on death deed work in Oklahoma?

As a record owner of the real estate, you must first execute a transfer on death deed.  This legal document identifies the property interest to be transferred along with the name(s) of the beneficiary and your signature.  After you execute, acknowledge, and record this document with the court clerk, you are done.  Upon your passing, the property directly transfers to the named beneficiary outside the probate proceeding.

However, before that happens the grantee must record a beneficiary affidavit along with a copy of the record owner’s death certificate.  Failure to record this affidavit with the county clerk within nine (9) months of the grantor’s death will revert the property back to the grantor’s estate.

What are the advantages of transfer on death deed?

There are many advantages of using the Oklahoma transfer on death deed.  It allows you to retain ownership of the property during your lifetime.  The interest does not pass to the beneficiary until your death.  During your lifetime, you can make all decisions including a decision to sell the property.  You can freely revoke a transfer on death deed or execute a subsequent one naming a different beneficiary.

Transfer on death deed is simple to execute and record.  You can sign the document and record it with the county clerk.

No notice of any type is required to be served upon the beneficiary.  Additionally, anyone can be named a beneficiary on this deed, family, friends, loved ones, or charitable organizations.

Transfer on death deed allows for the passing of real property outside of the probate proceeding.  In Oklahoma, all properties passing through a will or intestacy law must go through probate.  It is a court-supervised process where the deceased’s estate is inventoried, debts satisfied, and the remaining estate distributed to the heirs.  The process can be costly and time-consuming.  A transfer on the death deed can help you avoid this proceeding.

What are the disadvantages of transfer on death deed?

The Nontestamentary Transfer of Property (NTP) Act is a relatively new law in Oklahoma.  Because of this, there are few case laws on the use of a transfer on a death deed.  If you intend to convey property using a TODD for estate planning or any other purposes, you must use this document with caution.

After the death of the grantor, the grantee beneficiary must take an affirmative step of filing an affidavit accepting the transfer.  Failure to do so within nine (9) months of the grantor’s death will render the transfer void and revert the property back to the grantor’s estate.

Another significant drawback of a transfer on death deed is that the beneficiary, upon inheriting the real estate, assumes all encumbrances and liens attached to the property during the grantor’s lifetime, including mortgages, liens, and other recorded interests.  This means that the grantee may receive a property that is riddled with financial obligations or restrictions that may diminish its value or limit its use.

How to revoke a transfer on death deed?

The revocation process of a transfer at death deed is pretty straightforward.  The transfer to a grantee beneficiary may be revoked at any time during the lifetime of the record owner.  This is achieved by executing, acknowledging, and recording the revocation document with the county clerk where the property is located.  O.S. 58 §1254.  The record owner is not required to give notice to the current beneficiary grantee or get his signature or consent for the revocation to be effective.

You can also revoke a current transfer on death deed by changing the named beneficiary.   For instance, let’s say the current deed names John Doe as a beneficiary.  You can revoke this deed by executing and recording a new deed that names Jane Doe as the new beneficiary.

However, a transfer on death deed cannot be revoked by using a will.  If the will states that you revoke a current deed, then this revocation language is ineffective in revoking an otherwise valid deed.

OKC Real Estate Lawyer

Whether you are dealing with a transactional property matter or a civil litigation, we are here to assist you throughout the process.  Niroula Law will give your case the attention it deserves and help you navigate through the often-confusing legal processes.  Contact us online or by telephone to get in touch with a real estate law firm and to speak to a real estate attorney.