To put a house in trust is to designate a third party to hold it for another's beneficiaries. Fidelity Investments explains that the trust is created through the execution of a document that describes how the property is to be treated after the decedent’s death.Know More
The individual who creates the trust is the grantor, and the individual or entity that holds it is the trustee. The trust is established under the trustee’s name. CNN Money notes that ownership of the property is transferred to the trust.
According to Nolo, a trust allows the homeowner to set conditions for the home's passage to beneficiaries. For example the trust's grantor may specify that a child shall receive the home only after graduating college. The grantor can also mandate that a grandchild receive the home after the child's parents die.
A grantor who creates a revocable trust retains control over the home as its trustee or appoints a trustee. The grantor can make changes to the revocable trust's terms, according to Fidelity Investments. SFGate notes that an irrevocable trust usually requires the appointment of a trustee to hold the house. The grantor waives the right to change the irrevocable trust.
Fidelity Investments stresses that laws governing the establishment and management of trusts vary by state. Generally, however, the primary reason to put a house in trust is to keep it out of probate, according to SFGate. Probate, which is the legal process through which a decedent's property is distributed to beneficiaries, is time consuming and expensive, and the court decides how property is to be divided. Trusts may also offer tax savings, but any such benefit depends on the type of trust and its terms.Learn more about Credit & Lending
The Direct Express prepaid debit card is a card for beneficiaries of Social Security and Supplemental Security Income who want to obtain their benefits through electronic methods, according to Direct Express. The card enables them to use electronic transactions to access and spend their money instead of using cash.Full Answer >
A family trust is an allocation of funds or assets made to the beneficiaries with some conditions attached, according to USA.gov, the U.S. government's official web portal. The family trust is managed by the trustee who has the power to release funds to the beneficiary if the conditions of the trust are met.Full Answer >
An estate trust is an arrangement that allows a designated third-party to hold assets in the interest of named beneficiaries, states Fidelity. People often use estate trusts to specify the exact time that beneficiaries receive the assets included in the estate, ensuring their property does not go through probate.Full Answer >
There are a few ways that someone can change an irrevocable trust; the easiest way is when the beneficiaries and the grantor of the trust agree to the changes. The grantor must be alive at the time of modification. This is called modification by consent.Full Answer >