Real Estate Placed in a Living Trust If you are the sole owner of a piece of property, you can include that property in your living trust. You will need to change the property’s title to reflect the ownership change. If real property is transferred into a trust, there are several additional issues to consider, including the following:
Property tax reassessment: If you designate yourself as the trustee, many states, including California, will NOT require a tax reassessment when you transfer property into your trust.
Transfer taxes: Transfer taxes are normally assessed on real estate transfers. When the transfer is to a living trust, these taxes are usually not imposed. However, some states do tax living trust transfers. You should check with your County Assessor or Recorder’s Office to confirm that you will not need to make these payments.
Mortgage interest deductions: As the grantor, you can still deduct mortgage interest from your income taxes. Insurance policies: If you are the trustee, you do not need to change the registration of insurance policies if those policies cover property in the revocable trust. Tax breaks for the sale of a home: You can exclude up to $250,000 of profit from your taxable income when you sell your principal home, even if the trust owns the home . If there are co-owners, such as spouses, this exclusion is doubled to $500,000.
Homestead rights: Homestead rights, which protect a homeowner’s equity interest in his or her home, generally apply to trust property.
Due-on-sale clauses: A lender cannot enforce a due-on-sale clause if you are transferring your principal residence to your trust. If you are concerned about this, you may want to get your lender’s consent before making the transfer.
Partial interests: You can transfer a partial interest in real property to the trust (like a time share or an ownership percentage). If you’re ready to create a living trust, LegalZoom can help. Answer questions about your family and estate in our questionnaire and we’ll check your answers for consistency and completeness. We’ll assemble the paperwork you need and mail it to you, including detailed instructions for how to transfer property into your trust and how to execute all of the documents.
Source: Real Estate Placed in a Living Trust | legalzoom.com
NEVER AGREE TO DUAL AGENCY REPRESENTATION
Written by Loren Hoboy on Sunday, 20 October 2013 2:11 pm
Dual agency occurs when real estate agent represent both the buyer and seller on the same transaction. This occurs when a Buyer goes to a builder’s showroom and talks to one of their sales people, or when you call a Seller‘s agent directly from a sign or ad to view a home you are considering. It also occurs when you buy a house listed with the same Real Estate Brokerage company that your agent represents.
Dual agency means the Realtor is serving two masters. Other professionals like lawyers are not permitted to engage in this practice. Many real estate agents are not experienced and qualified to handle this conflict. It is illegal in every other fiduciary profession except under the most extreme circumstances. Under Dual Agency, real estate agents/brokers collect a double commission and theoretically they are prohibited from doing anything to the detriment of either party.
Dual agents are legally prevented from negotiating price or terms (two of the most important reasons consumers hire Realtors). Dual Agency is a conflict relationship that strips buyers and sellers of the Realtor’s service to a level that is essentially abandonment. It means that they are getting paid twice as much for doing much less work. In other words, all the reasons you hired your broker vanish – often with little warning. The broker could be acting in the client’s best interests all the way up to finding the house that creates a dual agency. At that point the buyer or seller are on their own.
Instead, when you use only an independent Buyer’s Agent they have a fiduciary duty to serve only your best interests. With Dual Agency representation you are taking a much higher risk.
Realtors, many who typically have little or no understanding of the legal ramifications of their own fiduciary relationship with their clients, can illegally counsel their clients of claimed “benefits” of dual agency or that it is “Not a Problem” as they ask you to sign the Dual Agency waiver. There are NO benefits to dual agency and you should NEVER agree to dual agency. In my opinion, find a small brokerage firm with highly qualified real estate agents and insist that they not engage in dual agency. The likelihood of dual agency arising with a smaller firm is far less than with a large real estate firm.
AVOID DUAL AGENCY-DO NOT SIGN THE DUAL AGENCY AGREEMENT- GET A TRULY INDEPENDENT REAL ESTATE AGENT TO REPRESENT YOU!
via Never Agree to Dual Agency Representation.