Many individuals are considering transferring their homes to living trusts to simplify the process for their heirs after death. This approach is recommended by some estate planners to avoid probate court proceedings.
Chris Van Atta, a senior wealth planner at City National Bank, stated that the use of living trusts has surged over the past three decades. A 2025 survey by Care.com found that approximately 13% of respondents included a living trust in their estate plans.
A living trust allows individuals to set terms for asset management after death while maintaining control during their lifetime. It can be changed or dissolved at any time while the grantor is alive.
Setting up such a trust and transferring a home to it typically costs between $400 and $4,000, according to LegalZoom. Future amendments may require legal assistance, with estate lawyers charging around $370 per hour on average.
The transfer process involves considerable paperwork, including deed transfers, beneficiary registration, and trustee selection. This can take weeks or months to complete.
Transferring property title to a trust can complicate mortgage arrangements, potentially triggering "due-on-sale" clauses in loan agreements. It may also affect refinancing options.
State and local governments have procedures for property tax assessments when homes are transferred through living trusts. Tax implications can usually be minimized with proper planning.
According to United Policyholders, transferring title could affect title insurance coverage. Insurers should be consulted about potential policy endorsements or new policies.