How Do I Transfer my Parent's Property to a Trust?
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Answer:
In order to establish a basic living trust the Grantor should prepare and execute a document called a declaration of trust which is similar to a Last Will and Testament. The declaration of trust sets forth the terms and conditions of the living trust In the document, the Grantor names himself or herself as trustee, and transfers assets to that trust. In order to transfer the property, the grantor must have legal capacity to understand the nature of his/her actions. If property is jointly solely owned by spouses, both spouses should sign the deed as grantors if both are giving up all interest in the property.
After creating the living trust the grantor should transfer personal assets into it. This is referred to as funding the trust In order to transfer real estate into the living trust a real property deed naming the living trust as grantee should be executed and recorded. A warranty deed or quit claim deed is commonly used to transfer real property to the trust.
The conveyance could be made by language such as the following in the deed of conveyance:
Bill Smith and Mary Smith do hereby convey to John Doe and Tom Jones, as Trustee of the Mary Smith Revocable trust the following described property as joint tenants with full rights of survivorship and not as tenants in common: Description of Property.
A notary may commonly be found at a bank. Attorneys are also notaries. The grantors and witnesses should sign in front of the notary. Typically, a small fee is charged. A proeprty deed is filed at the local recorder's office in the county where the property is located, usually along with a recording fee, which varies by local office.
There are two basic types of deeds: a warranty deed, which guarantees that the grantor owns title, and the quitclaim deed, which transfers only that interest in the real property which the grantor actually has. The only type of deed that creates "liability by reason of covenants of warranty" as to matters of record is a general warranty deed. a quit claim deed contains no warranties and the seller doesn't have liability to the buyer for other recorded claims on the property The purchaser takes the property subject to existing taxes, assessments, liens, encumbrances, covenants, conditions, restrictions, rights of way and easements of record. However, a person who obtains a mortgage is still liable for mortgage payments after executing a quit claim deed on the property securing the mortgage. The quitclaim is often used among family members or from one joint owner to the other when there is little question about existing ownership, or just to clear the title.
Joint tenancy is a form of ownership by two or more individuals together. It differs from other types of co-ownership in that the surviving joint tenant immediately becomes the owner of the whole property upon the death of the other joint tenant. State law, which varies by state, controls the creation of a joint tenancy in both real and personal property Joint tenancy property passes outside of probate, however, it may be severed so that the property becomes part of one person's estate and passes to that person's heirs. a joint tenancy between a husband and wife is sometimes known as a tenancy by the entirety. Tenancy by the entirety has some characteristics different than other joint tenancies, such as the inability of one joint tenant to sever the ownership and differences in tax treatment. In some jurisdictions, to create a tenancy by the entirety the parties must specify in the deed that the property is being conveyed to the couple "as tenants by the entirety," while in others, a conveyance to a married couple is presumed to create a tenancy by the entirety unless the deed specifies otherwise. Each joint tenant has an equal, undivided interest in the whole property All joint tenants, and their spouses, must sign deeds and contracts to transfer or sell real estate. a joint tenant may convey his or her interest to a third party, depending on applicable state law. This conversion would in effect terminate the joint tenancy and create a tenancy in common.
Tenants in common hold title to real or personal property so that each has an "undivided interest" in the property and all have an equal right to use the property Tenants in common each own a portion of the property which may be unequal, but have the right to possess the entire property There is no "right of survivorship" if one of the tenants in common dies, and each interest may be separately sold, mortgaged or willed to another. a tenancy in common interest is distinguished from a joint tenancy interest, which passes automatically to the survivor. Upon the death of a tenant in common there must be a court supervised administration of the estate of the deceased to transfer the interest in the tenancy in common.