Property Ownership, Real Estate Trusts

Question 1

Trust

Answer 1

An estate planning vehicle in which property is owned by an entity controlled by the trust maker.

Example Kyle put all his property and to Trust so that in the event of his demise, his assets could pass to his heirs outside of probate

Question 2

Trust

Answer 2

A Trust is a special relationship called a fiduciary relationship that is created between the trustee and the trust store. The trust store is the person who creates the trust. The trustee is the person who carries out the trustors wishes.

Question 3

Trustor

Answer 3

The individual creating the trust

Grantor, settlor conveys title to trustee

Example Lisa’s parents, as trustors, decided to make Lisa the trustee as she has always been the sensible one of the children.

Question 4

Trustee

Answer 4

The person in charge of caring out the term of trust

Example Lisa was the trustee for the parents estate, and acted on behalf of her self, and her siblings as beneficiaries

Question 5

Beneficiary

Answer 5

The person who receives the benefit of the trust

Question 6

Trust agreement

Answer 6

Instructions of the trust. Held privately, and not filed with the court. the cost to maintain the trust include payment for the trustee for minimal fees and operating expenses.

Question 7

Testamentary trust

Answer 7

Created, according to the terms of the will of a deceased person. Unlike, living trust, testamentary, trust do not avoid probate.

This is not the choice of trust that works best

Question 8

A type of trust is created during a persons, lifetime, and often used when minor child is involved. The property may be placed within the trust for their use in their lifetime, or when they reach an age, determined by the person who creates the trust. In the meantime, the trustee will manage it for them, according to the terms of the trust.

Answer 8

A living trust

Is created to dictate terms care in the event, the trust maker becomes incapacitated

Question 9

Testamentary trust

Answer 9

Is created, according to the terms of the will of a deceased person. Unlike living trust, testamentary, trust, do not avoid probate.

Question 10

All Estates must go through probate? True or false

Answer 10

False

Question 11

Property held within a living trust avoid probate, true or false?

Answer 11

True

Question 12

A living trust is created during a persons lifetime, and is establish to convey property
True or false

Answer 12

True

Question 13

A Testamentary trust is created, according to the terms of the will of a deceased person
true or false

Answer 13

True

Question 14

Both living and testamentary trust avoid probate
True or false

Answer 14

False

Question 15

Beneficiaries are not responsible for the cost of administering a testamentary trust
True or false

Answer 15

False

Question 16

The maker of the trust

Trustee
Trustor
Beneficiary

Answer 16

Trustor

Question 17

The person in charge of caring out the terms of the trust

Trustee
Trustor
Beneficiary

Answer 17

Trustee

Question 18

The person who receives the benefit of the trust
Trustee
Trustor
Beneficiary

Answer 18

Beneficiary

Question 19

To create a trust, the Trustor usually conveys property to the trustee with instructions, regarding how the trustee is to hold and manage it on behalf of the beneficiary

True or false

Answer 19

True

Question 20

The role of the Trustor and trustee cannot be held by the same person
True or false

Answer 20

False

Question 21

Spouses may transfer real and personal property into a trust and the name themselves as joint trustees with rights of survivorship
True or false

Answer 21

True

Question 22

In the case of a married couple, after the death of the second spouse, the estate is distributed to the beneficiary or beneficiaries named in the trust

Answer 22

True

Question 23

The creation of a trust is a legal process that is best handled by Atturny’s
True or false

Answer 23

True

Question 24

There are no cost associated with maintaining a trust
True or false

Answer 24

False

Question 25

Land trust

Answer 25

Has privacy, unless under court order.

Ease of conveyance : beneficiary interest in the land can be conveyed without having to go through the formality of a deed. Interest considered personal property to beneficiary even though interest conveyed is in real property.

Can be changed by the Trustor at any time until death

Specified term such as 10 2030 years, then the trustee must either extend the trust term when it expires or sell the real estate and provide the proceeds to the beneficiary

Question 26

What are negatives and positives of a land trust

Answer 26

Negative: lam, trust is revocable, trust, implying that it doesn’t offer any asset protection

Positive : transfer title to an LLC to protect their other assets. The land trust will prevent a bank from accelerating the mortgage note when the property is put into an LLC. The property would have protection from the LLC because of the liability it rolls from the trust to the LLC and that’s where the liability stops.

Lam, trust is set up with the property owner as the trustee and the third-party as the beneficiary.

Protected under Garn, Saint Germain act the federal depository act. This prevents lenders from accelerating notes whenever there’s a transfer into a grantor trust.

Question 27

What are other reasons land? Trust me also be helpful.

Answer 27

The state will impose a doc stamp

Moving the property to LLC would create a taxable event

When a property is paid off, it’s unencumbered and the owner desires anonymity.

Question 28

With a land trust, the person who establishes the trust(the Trustor) can’t also be the beneficiary

True or false

Answer 28

False
Usually the person who establishes the trust is also the beneficiary

Question 29

Land trust must be created at the time the real estate is purchase, not after it’s been acquired
True or false

Answer 29

False

Question 30

Are under a land trust, the owner directs, a corporate fiduciary to hold title to the real estate, and provides instruction for the management, Control, and disposition upon the owners death
True or false

Answer 30

True

Question 31

Lantrist generally don’t have a specific term
True or false

Answer 31

False
10, 20, 30 years is usually a common term once expired, the trustee renew, or sell the estate, and give the proceeds to beneficiary

Question 32

When the land trust term expires, the trustee must either extend the term or sell the real estate and provide proceeds to the beneficiary
True or false

Answer 32

True

Question 33

Summarize a land trust

Answer 33

Eleme Trust is formed specifically to hold real estate. Real property is the only asset within the trust.

Under a land trust the owner directs a corporate fiduciary to hold title to the real estate for a specific term (10, 20, 30 years) and provides instructions for management, Control, and disposition upon the owners death.

When the land trust term expires, the trustee must either extend the term or sell the real estate and provide the proceeds to the beneficiary.

Question 34

What are four benefits associated with land trusts?

Answer 34

A beneficiary interest in the land can be conveyed without having to go through the formality of a deed.

A land trust is a grantor. Trust that is revocable.

Asset transfers into trusts are protected by the garden, Saint German depository, institute act

The identity of the Trust owner is not made public