Transferring Texas Property to a Family Member: Your Options and What to Check First

Short answer. In Texas, transferring property to a family member often involves preparing, signing and delivering a deed, followed by recording it in the county where the property is located. But choosing the right approach depends on whether you want to give the property away now, sell it, or keep control during your lifetime and transfer it at death. Before signing, consider mortgages, taxes, homestead rights and whether the transfer can be undone.

This page explains the common options in plain language. It is general information, not legal advice.

Start with your goal

People transfer property to family for different reasons. The goal often points to the tool.

How the main options compare

The choice of approach decides who owns the property now, who controls it, what happens to the loan and taxes, and whether the transfer can be undone. This comparison is a starting point only. Each row has exceptions.

Gift deed (a deed given as a gift)

Who owns the property now: The new owner, once the deed is signed and delivered

Can the owner undo it alone?: Generally no. A new deed from the new owner or a court order is usually needed

Loan and due-on-sale: The loan stays with the borrower. Federal law protects some specified transfers, not every family transfer

What happens at death: The giver no longer owns the property, so it does not pass through the giver's estate

Sale to a family member

Who owns the property now: The buyer, once the sale closes

Can the owner undo it alone?: No

Loan and due-on-sale: Same due-on-sale question. A price below market value can be partly a gift for tax purposes

What happens at death: The seller no longer owns the property

TOD deed

Who owns the property now: The owner, until death

Can the owner undo it alone?: Yes. A TOD deed is revocable

Loan and due-on-sale: A TOD deed does not by itself trigger a due-on-sale clause during the owner's life

What happens at death: The property passes to the named beneficiary under the deed, which must have been recorded before death

Lady Bird deed

Who owns the property now: The owner keeps the rights the deed reserves

Can the owner undo it alone?: Depends on how the deed is written

Loan and due-on-sale: Depends on the loan and the deed

What happens at death: Passes as the deed provides

Trust

Who owns the property now: The trustee holds the property under the trust's terms

Can the owner undo it alone?: Depends on the trust

Loan and due-on-sale: A transfer to a trust is a separate due-on-sale question

What happens at death: Handled under the trust's terms

Will

Who owns the property now: The owner, until death

Can the owner undo it alone?: Yes. A will can be changed during life

Loan and due-on-sale: No effect during life

What happens at death: May require estate administration. A will cannot revoke a TOD deed

What makes a deed work, and what it does not do

This page is about choosing an approach and living with its consequences. For how to prepare, sign and record a deed, see our step-by-step guide and A Simple Guide to Deed Transfers in Texas. Three separate questions matter when you choose an approach, and they should not be mixed up: whether the transfer is effective, whether the deed can be recorded, and what recording does.

• Is the transfer effective? Texas law requires a transfer of real property of this kind to be in writing and to be signed and delivered by the owner giving the property, or by an agent the owner has authorized in writing. The statute calls for the giver's signature; it does not require the person receiving the property to sign. The Supreme Court of Texas has described the elements generally required for a deed to accomplish a legally effective conveyance: a writing, a sufficient description of the property, a giver and receiver who can be identified from the document, words showing an intent to convey, the giver's signature and acknowledgment, and delivery to the receiver and, if necessary, acceptance by the receiver. Even so, as explained below, an absent or defective acknowledgment does not necessarily invalidate an otherwise effective ordinary deed between the original parties. Delivery and intent matter because title passes when the deed is executed and delivered, and courts decide delivery by looking at all the facts, including whether the owner intended the deed to take effect now as a conveyance. A deed that is signed but kept back "just in case" can raise questions about delivery and intent. Filing a deed for record is evidence that it was delivered and meant to take effect, but that evidence can be rebutted.
• Can it be recorded? That is a separate question. To record a deed to real property, the giver must generally have signed it and acknowledged it before a notary or another authorized officer (or proved it in another way the statute allows), and a person who files it in person must show photo identification. A mailing address for each receiver must appear in the deed or an attached signed writing, or a penalty filing fee is paid. Leaving out the address does not by itself affect validity between the parties. For most Texas deed transfers, the grantor should have the deed properly acknowledged so it can be recorded. Texas law also permits certain other methods of proof for recording. An absent or defective acknowledgment does not necessarily invalidate an otherwise effective ordinary deed between the original parties, but it can create recording and third-party notice problems.
• What does recording do? A properly recorded deed is notice to everyone that it exists. An unrecorded deed is binding on the parties to it, on their heirs, and on a later buyer who does not pay valuable consideration or who has notice of the deed. But a deed is void as to a creditor or a later buyer who pays valuable consideration without notice, unless the deed has been acknowledged, sworn to or proved, and filed for record. Recording is strongly recommended. A TOD deed is different: it must be recorded before the owner dies.

What is a "gift deed"?

People often search for a "Texas gift deed." The phrase usually describes the purpose or the stated consideration, for example a transfer made "for love and affection." It does not describe one deed type that is right for every family transfer. A gift can be made with a general warranty deed, a special warranty deed or a quitclaim deed. In plain terms:

• General warranty deed: the grantor makes broad promises about the title, covering problems that arose at any time.
• Special warranty deed: the grantor makes promises only about title problems that arose through the grantor, such as during the grantor's own time of ownership.
• Quitclaim deed: the grantor passes along whatever interest the grantor has, if any, with no promises about what that interest is.

A quitclaim conveys whatever interest the grantor has, if any, without warranties of title. General and special warranty deeds provide different levels of title protection. These instruments are not interchangeable, and the appropriate choice depends on the circumstances.

Which deed fits depends on the title history, the relationship, and what the family wants to happen next. An attorney can review the title and discuss the options.

A deed is usually hard to undo

Once a deed has been signed and delivered and the transfer is effective, the person who signed it generally cannot cancel it alone. Getting the property back usually takes a new deed signed by the new owner, or a court order in limited situations. Think about this before you sign.

Questions About a Texas Deed Transfer? Speak With Our Real Estate Team.

Things to check before you sign

1. Your mortgage. Transferring ownership is different from releasing personal liability on the loan. A deed does not remove a borrower's obligation to the lender. Many mortgages also have a "due-on-sale" clause that lets the lender demand payment when the property is transferred. Federal law protects borrowers from a lender enforcing that clause in certain specified transactions involving residential property with fewer than five dwelling units. Those include some transfers where the borrower's spouse or children become an owner of the property. That does not mean every family transfer is protected. A gift to a sibling or a parent, for example, is not one of the transfers the federal statute lists by name, and other rules may apply. Read the loan documents and ask the lender before you sign.
2. Gift tax paperwork. A reportable gift may require the giver to file a federal gift tax return (IRS Form 709), even when no tax is immediately payable. Certain gifts, such as a gift of a future interest, must be reported no matter what the value is, and a sale for less than the property is worth can be partly a gift. Texas does not currently impose a general state gift tax. Ask a tax professional about your situation.
3. Tax basis for a later sale. A property's adjusted basis is, in general, the owner's cost for tax purposes, adjusted for certain items such as improvements. In general, someone who receives a lifetime gift takes over the giver's adjusted basis, with a special rule if the property's value at the time of the gift is lower than the giver's basis. Someone who inherits property generally gets a basis set by its value at the date of death, or at an alternate valuation date or by another method in certain cases. There are exceptions and special rules. The difference can matter a great deal when the new owner later sells. Ask a tax professional.
4. Property tax exemptions. A homestead exemption and any age-based or disability-based property tax limit are tied to the owner who lives in the home. After a transfer, the new owner may need to apply for their own exemption, and the giver may lose benefits. The county appraisal district can explain the process.
5. Homestead and spouses. If the property is the homestead of a married owner, Texas law generally does not allow either spouse to sell, convey or encumber the homestead without the other spouse joining in, whether the homestead is separate or community property. The law has limited exceptions, for example when a spouse has been judicially declared incapacitated or a court orders a sale in unusual circumstances. Do not assume a spouse's signature is unnecessary just because only one name is on the title.
6. Living in the home afterward. A deed that gives the property away now may not let you stay in the home or keep control. Other tools work differently. See "Passing property at death is a different tool" below.
7. Title insurance. A transfer can affect an existing title insurance policy. Ask the title company before you sign.
8. Government benefits. Giving away property can affect eligibility for need-based benefits such as Medicaid long-term care, which may review past transfers. Ask before you sign, not after.
9. The new owner's situation, including marriage. After the deed, the property belongs to the new owner. Their debts or a lawsuit could affect it. In general, property a spouse receives as a gift during marriage is that spouse's separate property. That does not mean a later divorce automatically gives the recipient's spouse an ownership interest in the property. Questions about creditors, reimbursement, homestead and marital property depend on the facts.
10. Other owners or heirs. If more than one person owns the property, or the property is held by a trust or company, the signature requirements change.

Passing property at death is a different tool

A deed that transfers ownership now and a tool that passes property at death are not the same thing.

• Transfer on death (TOD) deed. A properly executed Texas TOD deed must contain the essential elements of a recordable deed, state that the transfer happens at the owner's death, and be recorded before the owner dies. During the owner's life it generally does not take the property away from the owner. The owner can still sell or borrow against the property, and the deed does not by itself trigger a due-on-sale clause. A TOD deed can be revoked, and a will cannot revoke or replace it.
• Lady Bird deed. This is not a TOD deed under the Texas statute. It is a deed whose terms are written to let the owner keep certain rights during life, such as living in the property, while the property passes at death. How well it works depends on how the deed is written.
• Trust. Property placed in a trust is handled under the trust's terms.
• Will. A will may require estate administration after death, so it is not functionally the same as a TOD or Lady Bird deed.

Our comparison page explains these options in more detail.

Common steps

1. Confirm who owns the property and how it is titled. Get a copy of the current recorded deed.
2. Decide the goal, and choose the approach (gift now, sale, or transfer at death).
3. Review the loan, tax, insurance and benefits questions above.
4. Decide who will prepare the instrument. See Do I Need a Lawyer to Transfer a Deed in Texas?
5. Carry out the transfer by following the process in our deed guides.
6. Confirm the recording and keep copies of the recorded documents.
7. Update tax, insurance and utility records as needed.

When talking with a lawyer can help

You may want legal review if:

• there is a mortgage or other lien on the property;
• more than one person owns it, or you are not sure who does;
• the property is a homestead, or a spouse or former spouse may have an interest;
• the title has gaps or old problems;
• your goal is to keep control and avoid a delay in passing the property on at death; or
• you are not sure which deed fits.

For a short explainer on who may prepare a deed and when review helps, see Do I Need a Lawyer to Transfer a Deed in Texas?

How AWA Law Firm can help

AWA Law Firm's real estate practice includes deed preparation, and its estate planning practice assists with wills and trusts. See also our deed-transfer guide. Contact the firm to discuss which instruments and scope of services are appropriate for your situation.

Frequently asked questions

Can I transfer my house to my child without selling it?

Yes, an owner can generally give real property to a child by signing and delivering a deed, and then recording it. Before you do, check the mortgage, tax and benefits questions above, because a gift now is usually hard to undo.

What is the difference between a gift deed and a Lady Bird deed?

A gift deed transfers ownership now. A Lady Bird deed is a deed written to let the owner keep certain rights during life while the property passes at death. Our comparison page covers the details.

Will a deed change my mortgage?

No. The deed changes who owns the property, not who owes the loan. A due-on-sale clause may apply. Federal law protects borrowers in certain specified transactions, including some transfers where a spouse or child becomes an owner, but not every family transfer qualifies. Ask your lender.

Do I have to pay tax when I give a family member property in Texas?

Texas does not currently impose a general state gift tax. Federal gift tax rules may require a gift tax return even when no tax is due, and a gift can affect the new owner's tax basis. A tax professional can explain how this applies to you.

Can I take the property back after I sign a gift deed?

Usually not on your own. After delivery, getting the property back generally takes a new deed from the new owner or a court order in limited cases.

Does the deed have to be notarized or recorded?

For most Texas deed transfers, the grantor should have the deed properly acknowledged so it can be recorded. Texas law also permits certain other methods of proof for recording. An absent or defective acknowledgment does not necessarily invalidate an otherwise effective ordinary deed between the original parties, but it can create recording and third-party notice problems. Recording is a separate step. An unrecorded deed is binding on the parties to it, on their heirs, and on a later buyer who does not pay valuable consideration or who has notice of the deed. But it is void as to a creditor or a later buyer who pays valuable consideration without notice unless it has been acknowledged, sworn to or proved, and filed for record. For that reason, recording is strongly recommended. A TOD deed is different: it must be recorded before the owner's death to be effective.

Can I keep living in the house after I deed it to a family member?

That depends on the arrangement. A plain gift deed gives the new owner the ownership rights. Options that let you keep living in the home or keep control work differently. Review them with an attorney before signing.

Talk with AWA Law Firm

If you have questions about your situation, call AWA Law Firm at 713-581-1150 or use our contact page. Please do not send confidential information until an attorney-client relationship has been established. This page provides general information, not legal advice. Reading it or contacting AWA Law Firm does not create an attorney-client relationship. Every situation is different, and the law can change.