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April 8, 2008 |
A trust is a legal agreement in which a grantor transfers and entrusts his property to a person or corporation (the trustee) who then obtains title to the trust property. The trustee manages the property and uses it for the benefit of others (the beneficiaries). Establishing a TrustIn establishing a trust, the grantor designates a trustee to administer the trust. The trust outlines the trustee's duties and responsibilities and how the property should be held, invested, and distributed. While an oral trust is enforceable, it is prudent to put a trust agreement in writing. Trusts involving real estate generally must be in writing.
After creating a trust, the grantor must then transfer title of the trust property to the trust. Examples of trust property are real estate, stocks, life insurance, and bank and retirement accounts. If the trust property is real estate, a new title in the trust's name must be recorded. |
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