Can a Trustee Sign the Title of a Car Over Upon the Death of the Owner?

By Maggie Lourdes

Many people establish trusts to avoid probate proceedings for their heirs. Revocable trusts are the most popular choice for estate planning. This is because the trust maker retains full rights to change asset distributions, beneficiaries and trustees. A trustee manages and controls trust assets for the benefit of the trust's named beneficiaries and may transfer title to real and personal trust property according to the trust's terms.

Many people establish trusts to avoid probate proceedings for their heirs. Revocable trusts are the most popular choice for estate planning. This is because the trust maker retains full rights to change asset distributions, beneficiaries and trustees. A trustee manages and controls trust assets for the benefit of the trust's named beneficiaries and may transfer title to real and personal trust property according to the trust's terms.

Trust Assets

Before a trustee can transfer title of a decedent's car, she must be certain the trust is the vehicle's lawful owner. That means the trust maker must have transferred the car's title into the name of the trust prior to death. In that case, the trustee bears control over the legal title and may legally convey the car to a third person.

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Trust Terms

The trustee must transfer a car owned by the trust pursuant to the terms of the trust. For example, if the car was left to a named beneficiary, the trustee may not title it to a different beneficiary. If the trust states the car is to be liquidated, the trustee may sell the car at fair market value to a third person. Ultimately, the trustee is limited by the trust's terms when transferring the car title.

Signing the Title

To transfer a car title, the trustee must sign in his capacity as trustee of the trust. For example, if a car is owned by ABC Trust, the trustee can't simply sign his own name but rather sign as "John Doe, trustee of ABC Trust." The conveyed title should then be recorded at the proper state agency to complete the transfer.

Handling the Payment

Any money paid for the car should be deposited into a trust account by the trustee. The proceeds should be distributed or held according to the trust's terms. At the time of transfer, the trustee should also ensure the vehicle's insurance has been transferred to the new owner or the new owner has purchased a new policy. A trustee should not allow the car to leave her possession until the title is fully transferred and recorded with the appropriate state agency and insurance is in place. This protects the trust against liability for future accidents or injuries involving the car.

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How to Remove a Vehicle From a Family Trust

References

Related articles

How to Title Assets for a Trust

Transferring property from yourself to your revocable or irrevocable trust is known as funding the trust. Only assets that are properly titled to the trust can avoid probate at your death. Exactly which assets you should transfer, depends on your financial picture -- but how you title the assets is the same for various trusts.

Documents for Putting Property Into a Living Trust

Living trusts can be a powerful estate planning tool. Real property, business interests, automobiles, and other personal property can all be used to fund the trust, but the exact process can vary from state to state. In some cases, this requires executing a new deed or title, or filing other transfer documents. Knowing the appropriate state laws and paperwork required to place your property in a trust will help ensure that your property avoids probate.

Is a Living Trust Liable or Subject to Probate?

A living trust holds assets that are managed by a trustee for intended beneficiaries. Also called a revocable trust, it differs from other trusts in that the trust creator, or grantor, can also serve as the trustee and can make changes to, or even revoke, the trust in its entirety during his lifetime. Living trusts are attractive because the grantor retains ultimate control over his assets while he is alive, but they are most commonly used to avoid probate.

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