In the realm of estate planning, a Transfer on Death (TOD) deed is a tool that allows property owners to pass real estate directly to a beneficiary without the need for probate. While this option is relatively new in New York, understanding its uses and implications is crucial for both property owners and notaries involved in the process.

What is a Transfer on Death Deed?

A Transfer on Death deed is a legal document that allows an individual (the grantor) to name a beneficiary who will automatically inherit the property upon the grantor’s death. The key aspect of a TOD deed is that it avoids the probate process, which can be time-consuming and costly.

In New York, the TOD deed has been recently introduced, providing property owners with a new tool for estate planning. The grantor retains full ownership and control of the property during their lifetime, and the deed only takes effect upon the grantor’s death, at which point the property is transferred to the named beneficiary without the need for court involvement.

Uses of a Transfer on Death Deed in New York

In New York, the TOD deed serves several key purposes:

1. Avoiding Probate: The primary advantage of a TOD deed is that it bypasses probate, allowing the beneficiary to receive the property directly without court involvement.
2. Simplicity: Compared to setting up a trust or other estate planning tools, a TOD deed is relatively straightforward and inexpensive to execute.
3. Retaining Control: The grantor retains full control of the property during their lifetime, including the ability to sell or mortgage the property without the beneficiary’s consent.
4. Flexibility: The grantor can revoke or change the TOD deed at any time before their death, providing flexibility as circumstances change.

What Notaries Should Pay Attention To

For notaries in New York, understanding the nuances of TOD deeds is essential. Here are key points notaries should be mindful of:

1. Proper Execution: Ensure that the TOD deed is properly executed according to New York state laws. This includes confirming the grantor’s identity, witnessing the signing of the document, and affixing the correct notarization.
2. Revocation and Changes: If a client wishes to revoke or amend a TOD deed, ensure the new deed or revocation is executed with the same formalities as the original. Notaries should be meticulous in these situations to prevent future legal disputes.
3. Educating Clients: Clients may not always understand the legal implications of a TOD deed. Notaries should be prepared to recommend that clients seek legal counsel to their questions.
4. Jurisdictional Compliance: While TOD deeds are now recognized in New York, it’s crucial to ensure all documents comply with the specific requirements set forth by the state. This includes understanding any recent changes to the law that may affect the execution and recording of these deeds.
5. Ethical Considerations: Notaries must maintain impartiality and should never provide legal advice unless they are also a licensed attorney. Instead, guide clients towards seeking appropriate legal assistance.

What do you need to know as a notary?

1. It doesn’t look like a deed – see the file section below.
2. There is no TP584 or RP5217 required.
3. The grantor’s signature must be notarized.
4. Two witnesses are required at the time that the grantor signs.

What we are still waiting for clarification on either by law or litigation:

1. Can the notary be a witness? The general consensus is that “no” the notary should not be a witness.
2. Do the witnesses’ signatures get notarized? This is a split decision. All the deeds recorded so far (less than a dozen) have not had the witnesses’ signatures notarized. The recommendation is that if there is a title company involved, check with the underwriter, and if there is no underwriter involved, notarize the signatures of the grantor and the witnesses.
3. Can a TODD be done via remote online notarization? Most everyone is in agreement that since this creates a fiduciary responsibility regarding a property transfer in the estate document space it should not be executed by RON.

The introduction of Transfer on Death deeds in New York provides a valuable tool for property owners seeking to streamline the transfer of real estate to their beneficiaries. Notaries play a critical role in ensuring these documents are properly executed and compliant with state laws. By staying informed and adhering to best practices, notaries can provide valuable services that help clients navigate the complexities of estate planning with confidence.

TRANSFER ON DEATH DEED AND REVOCATION.PDF