Understanding Revocable Trusts

A revocable living trust is an estate planning vehicle that allows a person (the grantor) to transfer ownership of their assets into a trust during their lifetime. Typically:

• Grantor/Settlor: Creates the trust.
• Trustee: Manages the trust (often the same person as the grantor while they are alive).
• Beneficiaries: Receive the benefits of the trust’s assets.
  
  

The major advantage? When the grantor passes, the assets usually avoid probate. A successor trustee can step in to manage or distribute trust assets, including real estate.

Key Documents Realtors Need to See

• The Full Trust Agreement: Don’t settle for a summary, only the complete document shows the trustee’s true powers, restrictions, and successor provisions.
• Proof of Trustee Authority: If the grantor is still alive and acting as trustee, authority is typically clear. But if a successor trustee has stepped in, additional evidence (like a death certificate or resignation) may be required.
• Property Title: Confirm the deed reflects the trust correctly (e.g., Jane Smith, Trustee of the Jane Smith Revocable Living Trust dated January 1, 2010).
  
  

Situations Where Extra Care is Needed

• A seller resists providing the full trust agreement
• Confusion over who is authorized to sign documents
• Multiple trustees needing to act jointly
• Family disputes after the grantor has passed or has become mentally incapacitated
• Trust language that is outdated, unclear, or conflicting
• Title discrepancies that don’t match the trust
  
  

Final Takeaway

Selling property held in a trust isn’t drastically different from a standard transaction, but it does require more upfront diligence. Confirming trustee authority, verifying title, and getting proper documentation early on can prevent major complications later. When questions arise, guiding your clients toward a real estate attorney is the best way to protect the transaction.

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