If you're a Wisconsin resident who owns property and is considering setting up a trust to protect your assets, you may be wondering whether you can sell a house that is in trust. The answer is yes, but the process can be complex, so it's important to understand the steps involved.
In this guide, we'll walk you through the basics of selling a house that is in trust in Wisconsin, including what a trust is, how it affects the sale of your property, and what steps you need to take to sell your home successfully. We'll also offer some tips on how to ensure your sale goes smoothly and efficiently, so you can get the best possible outcome for your situation.
What Is a Trust?
First, let's define what a trust is. A trust is a legal arrangement that allows you to transfer ownership of your assets to a trustee, who will manage those assets on behalf of the beneficiaries you name in the trust. The trustee has a legal duty to manage the assets in the trust in accordance with your wishes, as outlined in the trust document.
There are different types of trusts, but the most common is the revocable living trust. With this type of trust, you can transfer ownership of your assets to the trust during your lifetime and retain control over them as the trustee. You can also name yourself as the beneficiary, so you can continue to use and enjoy your assets as you did before they were placed in the trust. The trust becomes irrevocable after your death, at which point the assets are managed by the successor trustee you named in the trust document.
How Does a Trust Affect the Sale of a House?
If you've transferred ownership of your house to a trust, the trust now owns the property, not you personally. This means that you can't sell the house yourself; the trustee must handle the sale on behalf of the trust.
However, as the grantor (creator) of the trust, you can give the trustee the power to sell the property by including specific provisions in the trust document. For example, you can include language that allows the trustee to sell the property at any time, or only under certain conditions, such as when the beneficiaries agree to the sale.
It's important to note that the trustee has a legal duty to act in the best interests of the beneficiaries when managing the assets in the trust. This includes the sale of the house. The trustee must make decisions that are in the best interests of the beneficiaries, such as selling the property for the highest possible price, or using the proceeds of the sale to benefit the beneficiaries in another way.
Steps to Selling a House That Is in Trust
Now that you understand the basics of how a trust affects the sale of a house, let's walk through the steps involved in selling a house that is in trust.
Step 1: Determine the Trustee's Powers
The first step is to review the trust document to determine the trustee's powers regarding the sale of the property. If the trust document grants the trustee the power to sell the property, the trustee can begin the process of listing the property for sale.
Step 2: Choose a Real Estate Agent
The trustee should choose a reputable real estate agent who has experience selling properties that are in trust. The agent should have a deep understanding of the legal and financial aspects of selling a trust property, as well as the ability to work collaboratively with the trustee and beneficiaries.
Step 3: Prepare the Property for Sale
Before listing the property, the trustee should prepare it for sale. This may involve making necessary repairs and improvements, staging the property, and setting a fair market price based on comparable properties in the area.
Step 4: List the Property for Sale
Once the property is prepared, the trustee can list it for sale with the chosen real estate agent. The listing should include all necessary information about the property, including any disclosures required by law.
Step 5: Accept an Offer and Negotiate
When a potential buyer makes an offer on the property, the trustee should review it and consult with the beneficiaries before accepting or rejecting it. If the offer is accepted, the trustee should negotiate the terms of the sale, including the price, closing date, and any contingencies.
Step 6: Transfer Ownership of the Property
Once the terms of the sale have been agreed upon, the trustee should work with the real estate agent and the buyer's attorney to transfer ownership of the property. This may involve completing necessary paperwork and providing documentation related to the trust and the sale of the property.
Step 7: Distribute Proceeds to Beneficiaries
After the sale is complete and any outstanding debts and expenses related to the property have been paid, the trustee should distribute the proceeds from the sale to the beneficiaries in accordance with the terms of the trust.
Selling a house that is in trust can be a complex process, but by following these steps and working with experienced professionals, it can be a smooth and successful transaction.
Heritage Law Office: Your Trusted Legal Partner for Probate, Estate Planning, and Business Law Services
If you're looking for a trusted legal partner to help you navigate the complex world of probate, estate planning, and business law, look no further than Heritage Law Office. Our experienced attorneys provide personalized and comprehensive legal services to clients throughout Wisconsin.
Whether you're looking to create a will, establish a trust, or start a new business, our team can help. Contact us today at 414-253-8500 or by sending us a message to schedule a consultation and learn more about how we can assist you with all of your legal needs.