Can I sell a house that is in a trust in North Carolina?
Absolutely. One thing to note is that it needs to be a Revocable Living Trust. The grantor (owner) retains the power to sell. If it’s an Irrevocable Trust, this is where the designated Trustee has that authority to sell so long as they have the proper trust documents. In North Carolina, selling a home in a trust requires a real estate attorney to review the “Memorandum of Trust”. Most Trustees can sell to a cash buyer directly such as through ILM Home Offer.
I just wrapped up a sale yesterday in Wilmington for a client. I get this particular kind of seller at least once a month: the trust sellers. So what do I mean by that? Let’s delve into the story of what happened. The client calls me about her father’s house and how she plans on selling it. After her father passed away, no one in the family wanted to keep the house. So selling it was the best possible option. So can you sell a house in a trust? Yes, selling house in trust NC is possible, but there are things you need to know beforehand.
The client was the Trustee in this situation. She had a trust document that provided her the authority to sell the home. After doing the research on how to sell the home through traditional means, she called my team and I at ILM Home Offer. If you’re selling a house in a trust, we’ll offer you a cash deal if you’re intending on getting the deal done fast. When the client was told about this, she breathed a sigh of relief. “I cannot imagine how much money I’d lose keeping this home on the market,” she said.
Can You Sell a House That Is In A Trust? Understanding Your Authority
Yes. But let me remind you that the trust document is what you need to prove you have the power and authority to sell the house in question. As I mentioned earlier, there are two types of trusts. Here’s what they are:
- Revocable Trust: This is where the original owner or grantor can usually sell at any time.
- Irrevocable Trust: The Trustee controls the sale so long as the trust allows it.
The language in the agreement is something that you need to pay attention to. It’s also something that I’ve seen get confused by the sellers in this situation. One of the questions I ask a Trustee is whether they have co-trustee approval or specific authorization to sell the house. If the answer is “yes”, we move forward. If the answer is “no”, then we hold off on the deal until we know for sure.
I should probably bring this up while we’re on the subject of approval and such. North Carolina is one of those states where each sale needs to go through a closing attorney, not just the title company. This is an attorney who will need the Memorandum of Trust or Certificate of Trust. This confirms that you have the authority to sell, the trust is valid, and the title can legally transfer.
Traditional buyers get nervous here at this stage. Not to mention, lenders slow things down as well. It makes the traditional sale process a lot harder. Don’t get me started on how much money you’ll stand to lose if you let the property sit. But the good news is that if you have the legal authority to sell the house in a trust, we’ll be glad to help you out since we buy houses in Jacksonville and the nearby towns.
Why Selling a Home in a Trust Traditionally Is A Headache
Allow me to be blunt for a moment about selling a home in a trust through traditional means. It won’t be a smooth ride. In fact, I dare say that you are in for a rude awakening from the moment you start listing the house on the MLS. Because you’ll be facing so many problems right from the jump. This includes:
- The repair trap: I have seen many trust-owned homes that haven’t been updated in decades. I’ve also seen houses that deferred maintenance or even fall apart. None of them could ever pass a clean inspection. If you do accept an offer (if you’re lucky), the buyer will ask for repair credits that will cost you thousands of dollars on top of the closing costs. Those deals fall apart fast. Why not sell as-is in Leland if the house needs repairs?
- The holding cost problems: Each month, the trust pays the property taxes, insurance, utilities, and yard maintenance. This is what the first client I mentioned earlier didn’t want to deal with and she was able to sell the house to avoid that issue.
- The timeline you’re never told about: Many sellers don’t know about this timeline. A “fast” traditional sale can take 30 to 45 days to get under contract and another 30 to 45 days to close. In total, that’s 60 to 90 days in total. “Fast”? Ha! Not a chance. But this same client I talked about was smart to avoid it. I think she may have heard about another seller suffering that unfortunate fate.
How to Sell a House in a Trust for Cash: The ILM Process
I have bought houses from Trustees that want to get it done clean, fast, and legally. My team and I at ILM Home Offer are ready to help you. Instead of asking yourself “how long does it take to sell your home”, we’ll give you the answer: as little as 14 to 21 days. Here’s how it works:
- You contact us and we’ll perform a 15 minute property discovery.
- We’ll need to make sure you have the legal authority to sell this sale. This means you need to procure the Certificate or Memorandum of Trust before we move forward. It will confirm that you are indeed the one who has control over the sale. After the home is sold, we work with the local NC real estate attorneys for anything else that needs to be addressed.
- The offer is a straightforward cash offer in Wilmington or the surrounding towns where the house in question may be. Whatever the number is, the trust will net it. You don’t need to worry about commissions or hidden fees. Nor do you need to worry about the property condition, market value, and repair needs.
- We can close on your timeline. It’s faster than the traditional approach.
Beneficiary Peace of Mind: Speed and Transparency
One last thing I want to discuss is the peace of mind that comes with speed and transparency. You can sell the house to avoid family friction. For example, you may want to sell fast but one other sibling wants to renovate the home while the other wants to sell it at a higher price point. That’s where it becomes a people management situation rather than one pertaining to a property.
I also believe that you can get a clear offer and a closing date when you sell to my team and I. Also, you and your siblings or other family members don’t need to debate on repairs. The proceeds go to the trust and the Trustees are given their portion of the funds. I want you to experience the major reason why direct cash buyers are the best option rather than go through the traditional channels.
FAQ: Selling a House That Is in a Trust in NC
Can I sell a house in a trust if the grantor is still alive?
Yes. A revocable trust allows the grantor to sell the home. Please note that the documents need to be signed in the Trustee’s capacity even if it’s the same person. This is required due to North Carolina’s title insurance laws.
Who signs the paperwork when selling a home in a trust?
The Trustee signs the deed. If there are co-trustees, both may need to sign. Also, I highly suggest that all trustees look at the trust language to get a good understanding of things. Knowing the language can make a difference between a successful sale and one where delays can happen constantly.
Do I have to pay taxes on the sale proceeds?
If you are going through the traditional means, chances are you may pay little to no taxes. However, if the property is inherited and in a trust, it could mean the property value rests to current market value at the time of the owner’s death. Plus, the capital gains taxes are minimized. Through a trusted cash buyer, you won’t have to worry about this.
Conclusion: The Fastest Way to Liquidate a Trust Property in Wilmington
Selling a house in a trust isn’t just a real estate transaction. It’s a legal process, financial responsibility, and an emotional situation. Going the traditional route can make things a lot more complicated than they need to be. That’s why ILM Home Offer is ready to assist you with your home selling needs. Call us today to schedule a 15 minute property discovery check and we’ll be happy to help.