Trusts can be an excellent way to manage your assets and protect your family. However, if you are considering selling a house in a trust, it can be difficult to know where to start. This is because there are specific procedures that must be followed to complete the sale. It’s not a question of simply finding a buyer and signing over the deed. To ensure that the sale goes smoothly, it is important to understand the process and what steps need to be taken, given the unique circumstances of the house in your specific trust.
What Is a Trust?
A trust is a legal entity designed to hold assets on behalf of someone else. This can be for a variety of reasons, such as to protect the assets from creditors or to manage them in a way that the beneficiary sees fit. A trust is created by a settlor, who transfers ownership of their assets to a trustee. The trustee then manages the assets on behalf of the identified beneficiaries, among other legal responsibilities and duties.
Types of Trusts
There are four main types of trusts:
- Revocable trusts. A revocable trust can be changed or dissolved by the settlor at any moment.
- Irrevocable trusts. An irrevocable trust cannot be changed or dissolved by the settlor.
- Living trusts. A living trust is created during the settlor’s lifetime.
- Testamentary trusts. A testamentary trust goes into effect after the death of the settlor.
The type of trust will dictate how assets are managed and distributed. It is important to understand the type of trust you have to know what steps need to be taken to sell the house.
Selling a House in a Trust
The first step in selling a house that is in a trust is to contact the trustee. The trustee is the person who manages the assets of the trust. They will be able to provide you with information on how to proceed with the sale. In some cases, the trustee may need to give their approval for the sale.
The next step is to find a buyer for the house. This can be done through a real estate agent or by working with a home buying company. Once you have found a buyer, the next step is to negotiate a sales price. Once the sales price has been agreed upon, a purchase and sale agreement will need to be drawn up.
The purchase and sale agreement will outline the terms of the sale. It is important to have an attorney review the agreement to make sure that it is in compliance with the terms of the trust. The agreement will need to be signed by the trustee and the buyer.
Once the purchase and sale agreement has been signed, the next step is to complete the sale. The trustee will need to sign over the deed to the buyer. The buyer will then need to pay the agreed-upon sales price. Once the sale is complete, the trustee will need to provide a written account of the sale to the beneficiaries.
Considerations In a Revocable Trust
When selling a house that is in a revocable trust, the grantor has the option to make trust modifications at any time to the trust agreement. If the grantor decides to make changes, they will need to contact the trustee and provide them with written notice of the changes. For example, if the grantor is still alive and makes the decision to sell the property, the options are:
- The trustee can sell the house, and the profit is kept in the trust until the grantor’s death.
- A title transfer can be made from the trustee to the grantor. The grantor then sells the house and places the money in a new trust.
Considerations In an Irrevocable Trust
If the property is held in an irrevocable trust, the grantor does not have the option to make changes to the trust agreement without the consent of the beneficiaries. To sell the house, the trustee will need to either:
- Get the consent of all of the beneficiaries to transfer the title of the property to the grantor.
- Keep the property in the trust and sell it. The trustee will then distribute the profits to the beneficiaries according to the terms of the trust agreement.
As you can see, options exist for selling a house that is in a trust. It is important to understand the type of trust that you have and to work with the trustee to ensure that the sale is conducted in a way that complies with the terms of the trust to keep you and the beneficiaries protected.
Do I Need a Trust & Estate Litigation Attorney?
If you have questions about selling a house in a trust, you should contact an experienced trust and estate litigation attorney. An attorney can help:
- Determine the type of trust that you already have or provide details on which type of trust would best fit your needs.
- Navigate the sale process and help to ensure that it is conducted in compliance with the terms of the trust.
- Represent you in court if a dispute arises during the sale process or trust administration.
- Handle all of the paperwork and legal filings that are required to complete the sale.
- Serve as a strategic legal partner to help you protect your interests and the interests of the beneficiaries.
- Identify and address any potential problems that could arise during the sale process to prevent delays, mistakes, or complications.
The value of a house can be significant, so it is important to make sure that the sale is handled correctly. An experienced trust and estate litigation attorney can provide the guidance and support that you need to ensure a smooth process.
Contact Bochnewich Law Offices Today
If you are ready to sell a house that is in a trust, the first step is to contact an experienced attorney. At Bochnewich Law Offices, we have helped many clients sell their homes in a trust. We can help you understand your options and ensure that the sale is conducted in compliance with the terms of your trust. Contact us today to schedule a consultation. We look forward to helping you through this process to make sure that it is as smooth and stress-free as possible.