How to sell a house you inherit that is held in trust.
(Author, Karen Barber)
Estate Planning should be something we all should do to obviously make life easier for our children(s). This also includes real estate. In doing so, many will set up a trust. Unfortunately our children may not appreciate the investment opportunity & wish to sell it.
If the house you inherited is held in a trust, you will need to work with the trustee to sell it. For the most part, selling a home held in a trust is not too different from selling a home that you own however the sale of an inherited house can be accomplished in two ways.
1.The trustee conducts the sale of the property and the proceeds will become assets of the trust.
2.The trustee transfers title of the property to your name so you can sell the property.
Sell the Home with a Trustee
Verify the trust documents to confirm that the trustee has the power to sell the property. Usually, a provision granting the trustee the power to sell will be included in the trust document. If no power is granted, most courts will agree that the power is implied unless otherwise stated within the trust document.
Have the trustee hire a real estate agent who will list the home for sale. Again, the real estate agent will want to see the trust documents to confirm that the house in the trust can be sold and that the trustee is authorized to conduct the sale.
Provide proof to the title company that the trust is valid, that the trustee is identified as such by the trust document. In addition to the trust document, the title company may require a Certification of Trust signed by the trust attorney, a death certificate of the trust creator and a tax ID number.
Submit a closed purchase agreement with the buyer. This requires the signature of the trustee. Funds from the sale become assets of the trust the trustee may distribute to you or leave in the trust account for safekeeping.
Selling the Home without a Trustee
Review all trust documents to ensure there is no provisions that exist to prevent the trustee from transferring title of the property to you. If no restrictions exist, the trustee has the discretionary power to transfer the asset to the beneficiary(s).
Request that the trustee transfers the title of the home to your name. While the trustee has the power to do so, the trustee is not required to. It is up to the trustee to determine the best course of action for the trust.
Transfer the deed of trust for the home into your name. This step requires the cooperation of the trustee. The trustee will need to prepare a deed form that transfers the property from the trust to you. The trustee needs to file the completed deed with the local property office to make it official.
I suggest you hire a real estate agent to sell your house. Proceeds from the sale will go directly to you since you hold title to the property.
This is a very generalized information on how to sell an inherited property, however, please consult your local CPA, Attorney or Financial Planner to make sure that your states laws & regulations are followed.