If you buy a new house after creating a living trust, do not assume the property automatically belongs to the trust. The house generally must be titled appropriately for the trust to control it as intended. This is an important estate planning step to address during the purchase or afterward.
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Can my new home be titled in my trust at closing?
Often, yes. Ideally, provide your escrow or title company with the exact name and date of your trust before closing and ask how title can be taken in the trust. Your lender's requirements and the specific transaction may affect what is possible.
What if I purchase or refinance in my individual name?
Sometimes a lender requires individual ownership for part of a transaction. In that situation, your estate planning attorney may recommend preparing and recording a deed to transfer the property into the trust after closing. The deed must be handled correctly, including consideration of California property tax rules.
Is listing the house on my trust's asset schedule enough?
Do not rely on the schedule alone. A trust can exist while a new property is still legally titled outside it. Confirm the recorded deed and actual ownership. The firm's guide to including California real estate in your estate plan explains why coordinating property ownership matters.
What happens if I forget to transfer the new property?
Property that remains outside the intended trust arrangement may require court involvement after your death, including probate, or create problems if you become incapacitated. The outcome depends on the ownership and other applicable estate planning documents. The firm's guide to funding a California trust discusses the broader issue.
What should I do before or after purchasing a home?
Tell your estate planning attorney about the purchase or refinance, confirm how title will be held, and verify that any required deed is properly prepared and recorded. Reviewing the change promptly helps keep the house coordinated with the rest of your living trust plan. You can also attend a free estate planning seminar for more information.
