Asset Transfers (Trust Funding)

What Is Trust Funding (Asset Transfers)?

Trust funding is the process of legally transferring assets into your revocable living trust so they are covered by your estate plan. This involves:

✔️ Re-titling assets in the name of your trust
✔️ Updating beneficiary designations on financial accounts and policies
✔️ Ensuring real estate, bank accounts, and investments are properly recorded under the trust
✔️ Transferring business interests, personal property, and valuable assets into the trust

Without these steps, your trust may not control your assets, leaving your loved ones to deal with probate court, delays, and unnecessary expenses.

Why Is Trust Funding Important?

Many people mistakenly believe that once they create a trust, their assets are automatically protected. However, if assets aren’t properly transferred, they remain in your name and could end up in probate—costing your loved ones time and money.

Benefits of Proper Trust Funding:

✅ Avoids Probate – Assets in your trust pass directly to beneficiaries without court involvement.
✅ Maintains Privacy – Unlike probate, trust administration is private and keeps your financial affairs confidential.
✅ Prevents Delays – Beneficiaries receive assets quickly without waiting months or years.
✅ Ensures Control – Your wishes are followed exactly as outlined in your trust.
✅ Protects Incapacity Planning – If you become unable to manage your affairs, your successor trustee can step in and handle finances seamlessly.

If your trust is not funded, your estate plan may fail, and your loved ones may have to go through the costly and stressful probate process.

What Assets Should Be Transferred Into a Trust?

To ensure your trust functions properly, certain assets should be retitled in the name of the trust or have the trust listed as the beneficiary. These include:

✅ Assets That Should Be Funded Into a Trust

🏡 Real Estate – Primary residences, vacation homes, rental properties, land
🏦 Bank Accounts – Checking, savings, CDs, money market accounts
📈 Investment Accounts – Stocks, bonds, mutual funds, brokerage accounts
💰 Business Interests – LLCs, partnerships, corporations, family businesses
🚗 Vehicles – If required in your state (some states allow beneficiary designations instead)
💎 Valuable Personal Property – Collectibles, antiques, jewelry, artwork

❌ Assets That Typically Should NOT Be Placed in a Trust

🔹 Retirement Accounts (401(k), IRA, etc.) – Instead, update beneficiary designations to avoid tax issues.
🔹 Health Savings Accounts (HSA) – These must remain in your name.
🔹 Certain Life Insurance Policies – In some cases, a Life Insurance Trust (ILIT) may be a better option.

📌 Every estate plan is unique. We’ll review your assets and determine the best way to fund your trust properly.

How to Fund Your Trust – Step by Step

The process of transferring assets into your trust varies depending on the type of asset:

1. Real Estate Transfers

✔️ A new deed is prepared, listing the trust as the owner.
✔️ The deed is recorded with the county recorder’s office.
✔️ Mortgage lenders are notified, if applicable.

2. Bank & Investment Accounts

✔️ Contact your bank or financial institution.
✔️ Request ownership changes or update beneficiary designations.
✔️ Provide a copy of the trust if required.

3. Business Ownership Transfers

✔️ Update LLC or corporate ownership documents to reflect the trust.
✔️ Assign business interests in writing.

4. Personal Property Transfers

✔️ Create a personal property assignment to document the transfer.
✔️ For high-value assets, additional documentation may be needed.

At Brentwood Law, we handle the paperwork and legal filings for you—ensuring a smooth and stress-free process.

What Happens If You Don’t Fund Your Trust?

If your trust is not properly funded, your estate may still go through probate—which is exactly what a trust is designed to avoid.

🚨 Consequences of an Unfunded Trust:
❌ Probate Court Delays – Your loved ones may face months or years of court proceedings.
❌ Unintended Beneficiaries – Your assets may not go to the people you intended.
❌ Higher Costs – Probate can be expensive, reducing the amount your heirs receive.
❌ Loss of Control – A judge, not you, may decide how assets are distributed.

Even if you have a perfectly drafted trust, it won’t work unless your assets are properly transferred.

How Brentwood Law Can Help

At Brentwood Law, we don’t just create trusts—we make sure they are funded and fully effective. Our services include:

✔️ Reviewing your assets and determining the best way to fund your trust
✔️ Preparing deeds and transfer documents for real estate and businesses
✔️ Coordinating with banks and financial institutions for account transfers
✔️ Ensuring all paperwork is legally valid and properly recorded

Frequently Asked Questions (FAQ)

❓ How do I know if my trust is funded?
A trust is funded if your assets are legally titled in the trust’s name or list the trust as the beneficiary.

❓ Can I add assets to my trust later?
Yes! You can transfer assets anytime and should update your trust funding as you acquire new assets.

❓ Will my mortgage lender allow me to transfer my home into a trust?
In most cases, yes. Most mortgage lenders do not require you to refinance, but it’s best to check with them.

❓ What if I forget to transfer an asset into my trust?
A “pour-over will” can help ensure any overlooked assets are transferred upon your passing—but it’s best to properly fund your trust now to avoid probate.

Get Your Trust Funded & Your Assets Protected Today

Creating a trust is only half the job—proper funding ensures your assets are protected and smoothly passed to your loved ones. Don’t leave gaps in your estate plan.