Transferring Real Property to a Living Trust in California
The most common asset transferred to a Living Trust (also known as an intervivos trust) is the residence of the person creating a trust. Any Collaboratorsreal property which the settlor desires to be transferred to the trust must be done correctly. Here is a checklist of the steps to transfer real property into the Living Trust.
- Review the due-on-sale clause in the mortgage, if any. If a concern exists over the possible effect of clause, write to the mortgage lender to:
- Obtain the lender’s approval of the change of title.
- Verify that the settlors’ obligations under the existing loan provisions will remain the same.
- Obtain and review the deed to determine how title is held, the legal description, and the assessor’s parcel number.
- If title is held in joint tenancy, convert the property to community property by preparing either:
- A deed conveying the property from the parties as joint tenants to the parties as community property, or
- A transmutation agreement converting the property from joint tenancy property to community property.
- Prepare the appropriate deed.
- Determine the type of deed:(a) Grant deed; or
- (b) Quitclaim deed.
- Make sure the deed conforms to the recorder’s specifications
- Title should read as follows: [Name(s) of Trustee(s)], as Trustee(s), or their successors in interest, under [Name and Date of Trust].
- Have all the transferors execute the deed before a notary public.Prepare and obtain the transferee’s signature on the Preliminary Change of Ownership Report.
- Record the deed.
- Forward the original and one copy of the executed deed, together with the Preliminary Change of Ownership Report, and a (Documentary) Transfer Tax Affidavit – if required by the county (currently required in El Dorado, Merced, Riverside, San Bernardino, San Francisco, San Joaquin, San Mateo, and Santa Barbara) to the county recorder’s office of the county where the real property is situated, and request recordation of deed.
- Submit a check for the appropriate fee to the recorder’s office.
- Provide a stamped, self-addressed return envelope, and request that the county recorder return an endorsed recorded copy of the deed.