Online House Hunting

How do you buy a house that's in a living trust?

Parents have house in living trust; the selling price is to be equally divided amongst all siblings. One sibling wants to buy house now (while parents are still alive). Can this be done without changing the trust? Can the sibling purchase the house and then have its selling price split between the remaining siblings not to include himself? Parents are not interested in changing living trust as they are too old to want to mess with legal stuff, but are all for one sibling purchasing home now.

Public Comments

1. You'd buy it the same way any other house would be purchased. The trust then writes checks to each sibling...even the buyer.
2. Yes, but...the siblings should get together with the parents and the lawyer who set up the trust to ensure that any fine print in the trust is followed to the letter. Generically, a living trust remains at the sole discretion of the trustees (your parents) while they live. They can sell the house to whomever they wish and use the money to vacation in Japan for a month. The point of a living trust is to allow your parent to disregard the interest of their heirs (if they want to) while the are alive while providing for the smooth transition of assets (and control) outside of probate or before probate in the case of mental or physical disability. If the house is the only asset in the living trust, you may have to discuss the complication of closing a living trust prior to death. Most of the time the distribution of assets from a living trust does not take place until after the death of the principles -- the money from the sale would have to sit in a bank account or be invested in the name of the trust until then (You could not take possession of it). This is an example of why a living trust is often a poor choice for estate planning. It sounds like your family would have been better off if your parents house was not in a living trust.