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I want to sell the property, but wondered how to convey the deed when I find a buyer.
At the very least the deed over to the new owner will have to be accompanied by a notarized Certificate of Trust verifying the continued existence of the trust, the grantor’s or some other person’s role as trustee and his/her authority to convey the real property by reference to specific wording in the trust. Normally a copy of that key section of the trust defining the trustee’s authority is attached to the Certificate of Trust. This is much like when a corporation or business owns real property and has to supply a resolution from the business to allow the sale and direct an officer/owner to sign the deed, and also provide a statement from the Secretary of State that the business is in good standing.
Both the realtor and the closing attorney need to be made aware of the trust, its proper name and the current trustee(s). A Certificate of Trust may also be required by the real estate firm in order to list the property for sale. If you are doing a “For Sale by Owner” and you as a seller are acting in the role of trustee, you should disclose the name of the trust and your role as trustee when discussing and showing the property to potential buyers. And of course it’s the trustee, not you personally, that sign when a contract of sale is entered into.
When attorneys prepare living trusts they usually include a sample certificate of trust. Often these are signed by the original trustees and found in the estate binder. For this sale of real estate an updated certificate likely needs to be prepared. The initial trustee(s) may not be alive or not be serving because of incapacity. You may be a subsequent trustee named in a living trust where both grantors are now deceased and you are not only the trustee, but the sole or one of several beneficiaries. While preparing an updated certificate is something legally a trustee can do on your own, it’s not very expensive (especially considering the cost and time delays in doing something wrong) to the have the drafting or another qualified attorney review what changes may have happened during the life of the trust and prepare a current certificate. People often forget to update their funding of personal property and this is a good time to address that as well. Possibly, you might need advice on tax matters related to the sale such as the exclusion on the sale of a personal residence or capital gains issues, related probate or distribution issues on the death of grantor(s), and even terminating the trust.
WRITTEN BY LINDA KNAPP
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