Probate court proceedings (during which a deceased person's assets are transferred to the people who inherit them) can be long, costly, and confusing. It's no wonder so many people take steps to spare their families the hassle. Different states, however, offer different ways to avoid probate. Here are your options in New Mexico.
In New Mexico, you can make a living trust to avoid probate for virtually any asset you own—real estate, bank accounts, vehicles, and so on. You need to create a trust document (it's similar to a will), naming someone to take over as trustee after your death (called a successor trustee). Then—and this is crucial—you must transfer ownership of your property to yourself as the trustee of the trust. Once all that's done, the property will be controlled by the terms of the trust. At your death, your successor trustee will be able to transfer it to the trust beneficiaries without probate court proceedings.
If you own property jointly with someone else, and this ownership includes the "right of survivorship," then the surviving owner automatically owns the property when the other owner dies. No probate will be necessary to transfer the property, although of course it will take some paperwork to show that title to the property is held solely by the surviving owner.
In New Mexico, this form of joint ownership is available:
In New Mexico, you can add a "payable-on-death" (POD) designation to bank accounts such as savings accounts or certificates of deposit. You still control all the money in the account—your POD beneficiary has no rights to the money, and you can spend it all if you want. At your death, the beneficiary can claim the money directly from the bank, without probate court proceedings.
New Mexico lets you register stocks and bonds in transfer-on-death (TOD) form. People commonly hold brokerage accounts this way. If you register an account in TOD (also called beneficiary) form, the beneficiary you name will inherit the account automatically at your death. No probate court proceedings will be necessary; the beneficiary will deal directly with the brokerage company to transfer the account.
New Mexico allows you to leave real estate with transfer-on-death deeds, also called beneficiary deeds. You sign and record the deed now, but it doesn't take effect until your death. You can revoke the deed or sell the property at any time; the beneficiary you name on the deed has no rights until your death. N.M. Stat. § 45-6-401 and following.
New Mexico does not allow transfer-on-death registration of vehicles.
Even if you don't do any planning to avoid probate, your estate may qualify for New Mexico's simplified "small estate" probate procedures. For more details, see Probate Shortcuts. For more on avoiding probate, see 8 Ways to Avoid Probate, by Mary Randolph (Nolo).