Many people go through the process of creating a Revocable Living Trust to avoid probate, protect their loved ones, and simplify the transfer of their assets after death. However, there’s a detail that gets missed with increasing frequency – how your real estate is titled in the name of the Trust.
One of the most common issues that has been coming up in the recent years, that leads to unexpected court involvement, is when the deed to a property names the Trust, but not the Trustee(s) of the Trust. It may seem like a small detail, but it can have big consequences.
What’s the Problem?
Let’s say your deed reads something like this:
“Jane Smith Family Trust”
On the surface, it might look fine. But from a legal standpoint, this language is incomplete. A trust is not a legal person or entity that can own property, a Trustee must be listed. The proper way to title a property in the name of a Trust is:
“Jane Smith, Trustee of the Jane Smith Family Trust, dated [insert date trust created]”
Without a proper Trustee designation, the County Recorder may not accept transfer documents, title companies will likely refuse to insure title, and more importantly, after death, the Trustee will be required to file a Petition with Court.
Why This Matters
Improper titling can cause:
1. Delays in Trust Administration;
2. Additional legal fees to correct the issue after death;
3. Court involvement, including the need for a Heggstad Petition or a full probate if things aren’t clear enough;
4. Stress for loved ones during an already difficult time
What You Can Do
If you’re not sure how your home or other real estate is titled, now is the time to check. It’s a simple review that could prevent a world of trouble later. Contract Jessica R. Ward at (925) 459-1777 to set up a complimentary review of your current estate plan, and current real property deeds.
