Page 28 - Home Buyers and Sellers Handbook English - California

I Living Trusts -

Some Basics

Estate planners often recommend “Living Trusts” as a viable option when contemplating the manner in which to
hold title to real property. When a property is held in a Living Trust, title companies have particular requirements
to facilitate the transaction. While not comprehensive, following are answers to many commonly asked
questions. If you have questions that are not answered below, your title company representative may be able to
assist you, however, one may wish to seek legal counsel.

Who are the parties to a Trust?
A typical trust is the Family Trust in which the Husband and Wife are the Trustees and, with their children, the
Beneficiaries. Those who establish the trust and transfer their property into it are known as Trustors or Settlors.
The settlor’s usually appoint themselves as Trustees and they are the
primary beneficiaries during their lifetime. After their passing, their children and grandchildren usually become
the primary beneficiaries if the trust is to survive, or the beneficiaries receive distributions directly from the trust
if it is to close out.

What is a Living Trust?
Sometimes called an Inter-vivos Trust, the Living Trust is created during the lifetime of the Settlors (as opposed
to being created by their Wills after death) and usually terminates after they die and the body of the Trust is
distributed to their beneficiaries.

Can a Trust hold title to Real Property?
No. The Trustee holds the property on behalf of the Trust.

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