Living Trusts


A Living Trust is a legal document that can be used to hold legal title to your assets and provide for their management. During your lifetime, you (and your spouse) are the trustee(s) and beneficiaries of the trust. You name successor trustees to ensure your wishes are carried out if you become incapacitated and/or when you pass away. A Living Trust is "revocable," meaning that you can make changes to it or even cancel it entirely. Perhaps the greatest benefit of a properly designed and funded Living Trust is that it avoids the probate process and minimizes the expenses and delays associated with settling an estate.

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Yes, you have complete control over your assets during your lifetime, as long as you are mentally competent. You are the trustee and can make any transaction you wish. Since it is “revocable,” the Living Trust can also be changed or cancelled at any time. If you become incapacitated, your durable power of attorney takes effect and allows your loved ones to transact on your behalf according to the instructions outlined in the trust. When you pass away, the trust becomes “irrevocable,” meaning nobody can change the wishes and instructions contained in the trust. For married couples, the surviving spouse still has total control over his or her share of assets after its transfer to the survivor’s trust. Only the deceased spouse’s share is deemed "irrevocable."

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As long as someone continues to reside in the home, Federal law prohibits financial institutions from calling or accelerating loans when property is transferred to a Living Trust. There is one exception however—the Garn-St. Germain Act stipulates that residential real estate with more than five dwelling units is not protected. It is important to note that most owners of residential property with over five dwelling units have them titled through a business entity and the Garn-St. Germain exception does not apply.

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A Pour-Over Will is used to name a guardian for minor children and protect against intestacy in the event any assets have not been transferred into the trust before the Trustmaker/Owner passes away. In addition, it will invalidate any Wills that you executed in the past.  The purpose of the Pour-Over Will is to “pour” assets left out of the trust into it so that they are distributed according to the terms of the trust.

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