How to best protect Trust property?
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How to best protect Trust property?
There are 3 siblings who are entitled to a home their mother left in a “Living Trust”. I am the Trustee and want to transfer the home from the Trust to them in equal parts. However, 1 sibling has credit issues/loans to be repaid. If this sibling’s name is put on the deed, am I correct in assuming that a lien can be put on the house to collect this debt? This would jepardize the interests of all parties. Can I put the home in the name of the 2 other 2 siblings and prepare some type of legal documentation that protects the interest of the sibling with the debt (i.e. if the home was ever sold)? Or, if all agreed leave the home in the Trust, how would that affect me as the Trustee?
Asked on January 7, 2011 under Estate Planning, California
Answers:
M.T.G., Member, New York Bar / FreeAdvice Contributing Attorney
Answered 13 years ago | Contributor
I am sorry for your loss. You as trustee are given great power under the law to do as you see fit to protect the interest of the trust and the trust property. That means if you think that it may be best to leave the trust property inside the trust - and thereby leave the trust intact - so that it is not attached by creditors or its value diminished in any way, then you can make that decision. I would suggest, however, that you seek counsel from an attorney in your area to help you with all of this. You should be permitted counsel and the trust should foot the bill. Good luck to you.
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