deeds

How do I Transfer Real Estate into my Trust?

How do I Transfer Real Estate into my Trust?

Have you ever solved a Rubik’s Cube?

Of course not. They are scientifically impossible. Just a way to keep kids quiet on long road trips.

But you’ve definitely seen a Rubik’s Cube at some point. And although the concept seems simple enough—get the same colors on the same side of the cube—all the moving parts and three-dimensional reactions make your brain hurt.

Estate planning sometimes seems like a Rubik’s Cube.

You have all of these lengthy legal documents with strange words that do all sorts of different things that an attorney explained to you once but which you have now mostly forgotten.

Take trusts, for instance. You generally get a trust to avoid probate. But by itself, a trust is just some paper. It may be fancy paper—and it’s likely expensive paper—but it’s still just some paper. And paper alone usually does not avoid probate.

Funding Your Trust With Real Property

Real property (which I will use interchangeably with “real estate”) is often the most valuable type of asset a client owns. That makes it all the more important for those assets to avoid probate.

How do you do that? By funding your trust.

What is "funding" my trust and how do I do it?

What is "funding" my trust and how do I do it?

So you’ve created a living trust. Awesome. You are super responsible. Spectacular. Your estate is so planned. Excellent.

Reveling in your excellence, you may be thinking to yourself, “You did a great job, Self. You are so responsible, and your estate plan (which is very much planned) is good to go!”

But guess what? Yourself would be wrong.

Is my trust useless?

When you sign a trust document, you just have some sheets of paper. It may be fancy paper — and it’s definitely expensive paper — but it’s still just paper. And paper alone (usually) does not avoid probate. In other words: By itself, a signed trust can be pretty useless.

Think of a trust like a box. When you sign the trust, you have an empty box. To avoid probate, you want to fill that box with all your “stuff,” your assets. Anything that’s in the box at your death doesn’t have to go through probate. Anything that’s not in the box at your death does.

Do I Need Probate to Get My Inheritance?

Do I Need Probate to Get My Inheritance?

Hardly a day goes by that someone doesn't ask us whether they need to probate a deceased loved one's estate. So when is probate necessary?

When you hold title to (i.e., own) an asset, you can generally only lose title in two ways: by inter vivos (literally, "between the living) gift or by court order. By definition, you can only make an inter vivos gift while you are alive. Therefore, once you die, the only way to transfer title is by court order. That (among other things) is the basic role of the probate process.

Legal Briefs: What is a transfer-on-death deed?

Legal Briefs: What is a transfer-on-death deed?

Most people are familiar with deeds. Though they come in many different varieties, deeds convey (transfer) interests in real estate. Generally speaking, a conveyance is effective as soon as a deed is signed. With a transfer-on-death deed, however, the conveyance is effective only after the grantor (the person conveying the real estate) dies.

What are the benefits of a transfer-on-death deed?

The main benefit of a transfer-on-death deed is that the conveyance can avoid probate. Let's say Joe wants to leave his house to his son, Dan. If Joe provides in his Will that the house should go to Dan, the Will must still go through probate before Dan can get the house. But if Joe signs a transfer-on-death deed, all Dan will need to do is file an affidavit (and a death certificate) with the county clerk to obtain title to the house.