With a living trust, you as the “trustor” or “grantor” create a trust for your property and appoint a “trustee” to hold the legal title to that property, which can include real estate, personal items, and other types of assets. You can appoint yourself as the trustee and keep full control over the property, or you can appoint another person (such as a trustworthy relative) to be the trustee and manage your property. You also have the option to appoint a bank or an attorney to be the trustee.
Why make a living trust? — to avoid the hassle, delay, and cost of probate.
When you have only a will, or if you do not have a will, after your death your property must go through the probate process in accord with the laws of North Carolina. Your property must be inventoried and appraised, and then your debts and taxes must be paid from your estate, and only then can the remainder of your property go to the people you want it to go to.
The probate process takes time, and it costs money. Avoiding probate is a good strategy. With a living trust, the property you leave behind goes to the individuals you designate to inherit it, sooner and without the costs of probate being subtracted from it.
There are two general types of living trust:
1) The basic living trust, for an individual or couple, and
2) The AB trust, which, in addition to avoiding probate, saves money on estate tax.
Do you still need a will if you have a living trust? — Yes, as a back up for the trust.
If you don’t leave a will, any property that wasn’t included in the living trust will have to go through probate in North Carolina. It’s often the case that someone acquires property after the trust was created, but he or she doesn’t remember to add it to the trust. Your will can include a statement that you want whatever property you have that isn’t in the trust is to go to a specified person.
If you would like to talk with an experienced and caring Raleigh living trust attorney, please contact us. We’re here to help.