A Transfer on Death Deed, often called a TODD, is a legal tool that allows for the a transfer of real estate to a beneficiary when the owner dies, bypassing the probate court process. This instrument is specifically designed to simplify the inheritance of property.
What is a New Mexico Transfer on Death Deed?
A New Mexico Transfer on Death Deed is a legal document that lets a real property owner name someone to inherit the property automatically upon their death. The owner keeps complete control over the property while they are alive. This means they can sell, mortgage, or lease the property without any input or consent from the beneficiary. The beneficiary has no legal right or interest in the property until the moment the owner passes away.
This type of deed is exclusively for real property, which includes land and any buildings on it. The transfer is direct and automatic, making it a distinct and popular estate planning option.
Key Legal Requirements for a Valid TODD in New Mexico
For a TODD to be legally binding in New Mexico, it must satisfy several requirements under the Uniform Real Property Transfer on Death Act.1Justia Law. New Mexico Statutes Section 45-6-401: Short Title The person creating the deed, known as the grantor, must possess the same mental capacity needed to make a will, meaning they must be of sound mind and legal age. The deed itself must include the elements of a traditional deed, such as the grantor’s name, a full legal description of the property, and clear language indicating the transfer only happens at the owner’s death.
The TODD must clearly name the beneficiary or beneficiaries who will inherit the property. The grantor must sign the document in the presence of a notary public. The TODD must be recorded with the county clerk’s office in the county where the property is located before the owner’s death; an unrecorded TODD is not valid.2Justia Law. New Mexico Statutes Section 45-6-409: Requirements
Preparing Your New Mexico Transfer on Death Deed
To prepare a TODD, you will need the grantor’s full legal name and marital status, and the full legal names of the designated beneficiaries. When naming multiple beneficiaries, you must decide if they will inherit as “joint tenants with right of survivorship,” meaning the surviving beneficiary inherits the entire property, or as “tenants in common,” where each beneficiary’s share passes to their own heirs upon their death.
The property’s complete legal description, which is more detailed than a simple street address, is also required. This description can be found on the current deed to the property or obtained from the county clerk’s records. While you can find statutory TODD forms, it is often advisable to consult with a New Mexico attorney to ensure the document is correctly prepared for your specific circumstances.
Executing and Recording Your New Mexico TODD
The grantor must sign the Transfer on Death Deed, and this signature must be witnessed and acknowledged by a notary public. The notary’s role is to verify the identity of the signer and confirm that the signature was made willingly, adding a layer of legal formality.
After the TODD is signed and notarized, it must be recorded. This involves taking the original document to the county clerk’s office in the New Mexico county where the property is situated. The standard fee for recording a deed is set by state law at $25 and is uniform across all New Mexico counties.3Justia Law. New Mexico Statutes Section 14-8-15: Payment of Fees; Disposition The clerk will file the deed in the public records and return the original to you.
Changing or Canceling a New Mexico TODD
An owner who has recorded a TODD retains the right to change or cancel it at any time before their death. This can be done in several ways:
- Execute and record a formal instrument of revocation. This document must explicitly state the TODD is being revoked and must be signed, notarized, and recorded in the same county clerk’s office as the original TODD.
- Record a new TODD for the same property. If the new deed contains language that revokes the previous one or conveys the property to a different beneficiary, it will supersede the earlier document.
- Sell or transfer the property to someone else during their lifetime using a standard deed. Once that new deed is recorded, the TODD is automatically voided.
A TODD cannot be revoked or altered through a provision in the owner’s will.4Justia Law. New Mexico Statutes Section 45-6-411: Revocation by Instrument Authorized; Revocation by Act Not Permitted
How Property Transfers to the Beneficiary After Death
Upon the death of the property owner, the ownership interest legally transfers to the beneficiary named in the TODD automatically. While the transfer is immediate, the beneficiary must take steps to formally document their new ownership and clear the property’s title. This is done by recording an “Affidavit of Facts as to Death” in the land records of the county where the property is located.
While it is common practice to also record a certified copy of the owner’s death certificate, some New Mexico counties may not accept them for recording due to privacy concerns. The beneficiary should verify the specific requirements with the county clerk’s office.
The beneficiary receives the property subject to any existing liens, mortgages, or other financial claims that were on the property at the time of the owner’s death.5Justia Law. New Mexico Statutes Section 45-6-413: Effect of Transfer on Death Deed at Transferor’s Death The TODD does not erase these obligations. Furthermore, under New Mexico law, the property may still be subject to claims from the deceased owner’s creditors or for Medicaid estate recovery.6Justia Law. New Mexico Statutes Section 45-6-415: Liability for Creditor Claims and Statutory Allowances