Can You Take Your House Out of Your Living Trust?

Good question.

Yes, you can take assets out of your Living Trust so long as you have capacity.

If you are incapacitated, you cannot take assets out of your Living Trust. But a successor trustee will be able to act on your behalf to manage your assets including your home. This also includes taking assets out of your Living Trust.

So this means if you execute a transfer grant deed to transfer your house from your name alone into your Living Trust... you can still refinance, sell or do whatever else you want to with your house. This is because you are the trustee for your Living Trust.

I know, it can get confusing, but the light will come on and you will suddenly understand.

The person who sets up a Living Trust is called the settlor and the trustee. The settlor is the person who is creating and funding the trust. The trustee is the person who is managing the trust assets.  If you are alive and well, you will serve as the settlor and trustee. If you pass away, the successor trustee will take over management of your Living Trust and distribute your assets according to the terms of the trust.

A Living Trust is also called a revocable trust. It also referred to an inter-vivos trust. Inter-vivos is a fancy Latin phrase for living.

If you have an irrevocable trust, the rules change completely. See your attorney for more details about irrevocable trusts.