TRUSTS
Trusts are a good and legal way of avoiding probate. Trusts can be either revocable or irrevocable and each has their advantages. Most Living Trusts are revocable allowing the grantor to self-manage the estate's assets.
A good living Trust will include the following:
a. Pour-over will (granting the assets in any and all wills to the trust)
b. Power of Attorney (useful in cases of incapacity)
c. Living Will
A Trustee and perhaps Successor Trustees are appointed and they have the authority to carry out the delineated directions of the trust. Often, in a Living Trust, the original Trustee is the maker (grantor) of the trust. In marriage, husband and wife are usually Trustee or Successor Trustee.
Even if the trust is created, it is only a box into which all assets must be placed. For example, if real property remains in the individual name of the trust grantor, the property cannot be sold by the trust and must go through probate. Real property identified in a trust should be grant deeded to the trust.
Through a California Heggstad Petition it is possible to get a court order declaring that property listed on a trust schedule is nevertheless a trust asset, despite the fact that title to the property was not formally transferred to the trust. It is reliant on being able to prove grantor intent and is not guaranteed. It is a time-consuming process and can be expensive.
Trust real properties cannot be sold, or even listed, without a copy of the Proof of Trust (a specific part of the trust agreement). Escrow will require it.
In addition to listing the accounts in the trust, bank accounts can be assigned using a "pay on death" or "as Trustee for" designations. Ask your bank how best to do this. The same applies to stock broker and retirement accounts.
ISSUES
If no one can find a copy of the trust or will then, for all intents and purposes, no trust/will exists. Make sure that a copy is saved where executors and trustees can find them.
If in doubt consult with an attorney or certified financial planner. Bank Trust Departments can also be quite useful.
