How do I get a new Deed to Inherited Real Property?

People inheriting real property often ask, "How do I get the deed to the house in my name?" Wrong answers include going to a title company or going to the county clerk. So, what is the correct process for getting legal title to real estate in the names of the heirs of the estate? It helps to examine the difference between retitling a car with retitling a house, as people often think they are similar.

People may purchase or sell many vehicles over the course of their lifetimes whereas they may only inherit real estate once, and that being later in life when their parents die. The process for retitling a car is fairly simple. The seller and buyer of the vehicle both sign the back side of the title. The buyer takes the title to the department of motor vehicles who then issues a new title listing the buyer's name on the front of a new title to the vehicle. But what if the present owner of the vehicle is deceased? If there is no formal probate process ongoing, the heirs of the vehicle may complete an affidavit of heirship at the department of motor vehicles. The department of motor vehicles will then issue a new title in the name of one or more of the heirs of the estate.

The process for transferring title to real property is more complex than it is for a car. Usually a person that is selling a home lists the property for sale and a contract to purchase the property is signed. Because the buyer and the buyer's mortgage company want to be sure that they are getting good, marketable title to the property, the parties enlist the services of a title company. The title company's job is to ensure that the process goes smoothly, and to insure the buyer and his or her lender against any subsequent claims that the buyer did not receive full ownership of the property. The insurance is in the form of a title policy that will protect the buyer against any such claims. At the closing of the sale, the seller of the property will execute a deed, usually a General Warranty Deed or a Special Warranty Deed wherein the seller: 1) grants the buyer the seller's interest in the property; and 2) guarantees the buyer that the buyer is receiving good title to the property. The title company also issues the title policy at this time. Up to this point, there is no governmental involvement in the transfer.

There are only two points in the title transfer process wherein there is some sort of governmental involvement, neither involving the issuance of a new title or deed to the property. Upon the closing of the sale, the title company will record the deed executed by the seller with the county clerk in the county where the land is located. When the clerk records the deed, the clerk merely attaches a bar code or number to the deed. The clerk then scans the deed into the recorder's records so that it is searchable. The clerk then hands the original deed that was signed by the seller back to the person recording the deed, usually the buyer or his or her title agent. The recorder's function is merely ministerial, taking less than five minutes. The clerk does not issue new deeds. The clerk does not conduct a title search. The clerk's endorsement does not guaranty the buyer is receiving legal title to the property.

So what is the purpose of the county clerk? The clerk merely records original documents so that people who have an interest can research the deed history for a piece of property to draw a conclusion on their own as to who owns the property. Here is an example of the purpose of recording the deed. Lets say Attorney Duran stands out on a corner with his notary and starts selling and executing deeds conveying the Margaret Hunt Hill Bridge to passersby. An astute, would-be buyer of the bridge could research the county deed records to see if Attorney Duran did in fact own the bridge. They could quickly conclude that he does not and decline to give him money. What if Attorney Duran did own the bridge, but sold it multiple times? Again, an astute buyer could research the deed records and see that, yes Attorney Duran did own the land at one time, but he already sold it once and cannot sell it again. Thus, the purpose of the county clerk is to give notice to the world of deeds recorded with the clerk.

So if the county clerk cannot issue a new deed, then perhaps the title company can, right? Wrong, a title company cannot issue a new deed from a decedent to an heir. A title company's job is to facilitate a particular transaction and to guarantee the grantee that he or she is getting title to the property. Once the transaction is complete, the seller is relieved from any duty to issue a new deed to the buyer's heirs after the buyer dies. If you think about it, the decedent may have purchased the home 40 years ago. Even if the seller had a responsibility to execute a new deed (which they don't), the seller may not even be alive to execute such a deed. Furthermore, a decedent is not able to execute a deed because the decedent is deceased. Finally, there is no one at the title company that can execute a deed on behalf of the decedent.

So how does an heir get title to property left to him or her by a decedent? The Texas Estates Code states that title to property transfers at the moment of death, subject to creditors' claims and, if there is a will, subject to the will being admitted to probate. If there is not a will, the Texas Estates Code has rules as to who inherits the property. Those rules are based upon marital and family relationships. An affidavit of heirship or a court's judgment declaring heirship which lists the relationships can be recorded with the county clerk to give notice to the world as to who inherited the property. If there is a will, the will must be admitted to probate by a probate court judge. The will can then act as a deed by giving notice to the world as to who inherited the decedent's property. Alternatively, an executor appointed by a court pursuant to the terms of a will, may execute a deed (typically a warranty deed or a distribution deed) wherein the executor grants the decedent's interest in the real property to the heir named in the will.

The second point where the government gets involved in the transfer of property is, of course, taxes. Upon inheriting real property, the heirs of the property should immediately go to the county appraisal district and present to them the recorded affidavit or judgment declaring heirship, a certified copy of the will and the court's order admitting will to probate, or the executor's warranty or distribution deed. The appraisal district will then note the new owner's name on the tax rolls.

In conclusion, title to real estate should not be viewed as one document, such as a deed. Instead, think of title as a chain. Deeds from sellers to buyers are the links. The first link in the chain is from the state of Texas to a farmer. The next link is from the farmer to a developer. The next link is from the developer to the first buyer of the house. The next link is from the first buyer (who then becomes a seller) to a subsequent buyer, and so on and so forth ending where the decedent bought the property. The decedent is not here to execute the final link, a deed to the heirs of the estate. Probate is the process that provides that last link, be it through a will or per Texas intestacy provisions.

Contact the Duran Firm if you have any questions about re-titling real estate in the names of the heirs of the estate.