Does a Beneficiary Need to Change the Title of a House Before Selling?

By Larissa Bodniowycz, J.D.

Does a Beneficiary Need to Change the Title of a House Before Selling?

By Larissa Bodniowycz, J.D.

When you die, your estate goes through a process called probate. During probate, any outstanding debts are paid off and your assets are distributed to your beneficiaries. If you pass down real property, the beneficiary may or may not need to change the title of the house before selling—it depends upon how the house was passed down and when the beneficiary wants to sell it.

Title deeds with keys

Transfer to a Surviving Spouse

If two spouses own a house as joint tenants with a right of survivorship, ownership of the house will transfer to the surviving spouse upon one spouse's death.

In this instance, the surviving spouse generally does not need to change the deed as one spouse's death automatically transfers title to the surviving spouse. The surviving spouse will just need to provide a death certificate when selling the house, and he may also need to provide the death certificate to the county recorder's office.

Transfer-on-Death Beneficiary Deed

A transfer-on-death beneficiary deed is a legal document created during the property owner's lifetime. The benefit of such a deed is that it allows for transfer of real property but avoids the expensive and time-consuming probate process. This is the easiest method to transfer real property, but not all states allow it. Title in the home will not transfer until the homeowner has passed away.

In most cases, the beneficiary will not need to change the title of the house. He or she will just need to file the death certificate with the county recorder's office. With a transfer-on-death beneficiary deed, the beneficiary cannot sell the home right away after the owner's death. In many jurisdictions, the beneficiary must wait for a specified period of time before selling the home in order to allow objectors to challenge the transfer of title.

The Probate Process in Action

If the homeowner did not execute a transfer-on-death beneficiary deed, the beneficiary may need to change the name on the deed through the probate process. In most cases, this change is relatively straightforward.

The home will go to the person the homeowner designated to inherit it in his will. If the homeowner died without a will, the home will go to the individual designated to inherit the home pursuant to state intestacy laws. Under intestacy laws, a deceased person's property will generally go to his spouse, children, or closest relatives.

During the probate process, a judge will need to enter a court order transferring title in the home to the beneficiary. The beneficiary should change the title of the house to reflect the beneficiary's ownership if the beneficiary wants to reside in/maintain ownership of the house for some time after the owner's death.

If the beneficiary wants to sell the house during the probate process, the beneficiary will not need to change the title. In this instance, the estate itself is selling the house to a third party. Any funds received from the sale will first go to cover any outstanding debts of the estate and any remaining funds will go to the beneficiary.

When There Are Multiple Beneficiaries

Things can get more complicated when a homeowner chooses to leave a house to more than one beneficiary, as is often the case when a parent leaves his home to his children. In an ideal world, the beneficiaries will all agree on selling the house, proceed as normal, and split the profits evenly.

In the real world, beneficiaries are not always able to come to a consensus. If they cannot, the beneficiary seeking to sell will need to get approval from the probate court prior to selling or transferring title to a third party. The court will weigh both sides and may approve a partition action, forcing the sale of the home even if some beneficiaries object.

If you need to transfer a title, consult with an online service provider to prepare the property deed transfer for you.

This portion of the site is for informational purposes only. The content is not legal advice. The statements and opinions are the expression of author, not LegalZoom, and have not been evaluated by LegalZoom for accuracy, completeness, or changes in the law.