TRUST AGREEMENT- ShortSale
Benefits of creating an agreement while creating a trust
Trust agreement is the agreement made to transfer the ownership rights of the grantor to the trustee who is managing the trust in order to benefit someone other than the beneficiary (grantor). This legal document includes why the trust was being started and its purpose. Most importantly, this includes the terms and conditions on how to manage the assets of the trust and how the profits has to be shared with the beneficiaries. Generally, this legal agreement stands as a concrete proof and helps you to clear the disputes that arise in the future between the beneficiaries and the trustee. Most importantly, this agreement can be produced in the court, in case if there is any legal dispute filed against the trust.
Ideally, trust agreement is very integral part while creating the trust and this includes all the instructions on how you would like to run the trust. Most importantly, this includes how to manage the assets and how to distribute them after your death. Generally, this agreement includes the trustee name, who is actually the in charge of the trust, beneficiary names to whom the assets has to be distributed after your death.
Here are a few benefits the creator of the trust can reap by creating this agreement
Elude probate: The key benefit of creating this agreement is to avert probate and divide the assets in private. Usually, without a trust, the court takes up the responsibility of sharing the assets to the beneficiaries and then it becomes probate. Basically, the distribution of the assets by the court takes a lot of time and moreover, it incurs huge cost for the beneficiaries, i.e. they should pay for the attorney and other legal fees.
Various options: The trust agreement has all the terms and conditions pertained to the type of trust you are running. Ideally, there are two types of trusts, one is revocable, it means that this trust can change its name, terminate or get dissolved, but whereas irrevocable trust cannot be terminated.
Where to download TRUST AGREEMENT- ShortSale Template?
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STATE OF ___________________________
COUNTY OF ___________________________
This Agreement, made and entered into this ___________________________, by and between ___________________________ as grantor(s) and beneficiary, and ___________________________ (hereinafter called the Trustee), as trustee of this trust which is hereby designated as ___________________________.
TRANSFER OF PROPERTY. For the purpose of making a gift to the beneficiaries under this trust I, the grantor herein, have transferred, assigned and delivered and do hereby transfer, assign, convey and deliver to the Trustee the property shown on the schedule hereto attached and made a part hereof in trust for the uses and trusts hereinafter set out.
TRUST AS REVOCABLE. This trust shall be revocable, and the grantor herein expressly reserves all right and power, whether alone, jointly or in conjunction with others, to alter, amend, revoke or terminate this trust, or any of its terms, in whole or in part, including the right to substitute a trustee upon notice to any existing trustee. Upon such notice, the then existing trustee shall immediately turn over all books, records and property of this trust to the substituted trustee named by the grantor herein.
DISTRIBUTION OF INCOME. The trustee shall pay or authorize the payment of all income, earnings, avails and proceeds from said trust to the beneficiaries of this trust, to wit: ___________________________, during existence of ________________________.
BENEFICIARY RIGHTS. The interest of the named beneficiary shall consist solely of the following rights respecting any property held by the trustee pursuant to the terms of this trust:
The right to receive the earnings, dividends, proceeds, rentals, transfers, sales, or other dispositions of any trust property.
The right to select a financial institution which maintains trust property, if trust property is the type which would normally be maintained by a financial institution, subject to any limitations imposed by ___________________________ law or any other state in which the trust maintains property and, if such property should consist of tangible property, including but not limited to real estate, the right to select any manager or management controlling company to manage said tangible property regarding the rental, leasing or maintenance of such property;
The right to determine when any such trust property should be sold or otherwise conveyed.
The foregoing rights shall be deemed to be personal property and may be assigned and otherwise transferred as such. The beneficiary shall have no legal or equitable right, title or interest, as realty, in or to any real estate held in trust under this agreement, or the right to require partition of such real estate, but shall have only the rights, as personalty, set out above, and the death of the beneficiary shall not terminate this trust or in any manner affect the powers of the trustee.
DISTRIBUTION OF CORPUS. At the death of the beneficiary, the trustee shall distribute the property then in the hands of such trustee to the beneficiaries and devisees designated by the last will and testament of the beneficiary or; if the beneficiary failed to execute a last will and testament, then such distribution shall be made to the heirs of such beneficiary as determined and in such parts as are designated by the intestate laws of the state of ___________________________. However, in the event that any such beneficiary, devisee, or heir (as the case may be) shall not have attained the age of 18 years, then the share of such person shall continue to be held in trust until such person reaches the age of 18 years. In the interim, all of the net income from such share of such person who has not reached the age of 18 years shall be paid to, or used for the benefit of, such person.
LIABILITY OF TRUSTEE. The Trustee and his successor as trustee shall not be required to give a bond, and each trustee shall be liable only for such trustee’s own acts and then only as a result of such trustee’s own negligence or bad faith.
CLAIMS OF CREDITORS. Neither the principal nor the income of the trust, nor the interest of any beneficiaries therein, shall be liable for the debts of any beneficiary, nor shall the same be subject to anticipation or alienation or to seizure by any creditor of any beneficiary under any return or proceeding at law or in equity.
DUTIES AND POWERS OF TRUSTEE. In the management, care, and disposition of this trust, the trustee shall have (with the consent of the beneficiary) the power to do all things and execute such instruments as may be deemed necessary or proper, including the following papers, all of which may be exercised without the order of any court or without having to report to any court:
BONDS, INVENTORIES AND REPORTS. In the administration, management, care and disposition of this trust, the trustee shall not be required to make nor file any inventories or appraisals or other returns or reports to any court, or to give any bond, or to secure any order and consent of any court to perform any of the powers conferred on it in this trust, but the trustee shall keep full accounts and shall make annual reports to the beneficiaries hereunder (which shall be sent by mail to such beneficiaries not later than February 28 of each year) and shall at any time upon the reasonable request of any beneficiary hereunder give full information to such beneficiary as to the condition of the trust estate, the amounts received and disbursements made.
RETENTION FOR INVESTMENT. The trustee shall have the power to retain any property or investment in this trust in the form in which it may be received, and to invest and reinvest any and all forms of property of this trust, including common trust funds and chooses in action as the trustee in its discretion may deem advisable, without being limited by any laws restricting the character or size of investments which trustees may retain or acquire having regard always, however, for the needs of the beneficiaries, and the size of the trust estate.
POWER TO SELL AND EXCHANGE. The trustee shall have the power for any purpose to sell, exchange or otherwise dispose of any property at any time held or acquired hereunder, at public or private sale, for cash or on terms, with or without advertisement, and without any order of court.
POWER TO LEASE AND GRANT OPTIONS. The trustee shall have the power to make leases either as landlord or as tenant for any term, even though such lease or leases may extend beyond the period of this trust; and, in like manner shall the power to grant options, including options extending beyond the duration of this trust.
VOTING STOCK. The trustee shall have the power to vote in person or by proxy, whether general or limited, any corporate stock or other security held by it as a part of this trust and to agree to or to take any other action in regard to any reorganization, merger, consolidation, liquidation, bankruptcy or other procedure or proceedings with respect to any stock, bond, note or other security.
EMPLOYMENT OF AGENTS, ATTORNEYS AND BROKERS. The trustee shall have the power to employ such agents, brokers, accountants and attorneys as it may deem necessary or advisable and to pay reasonable compensation for their services.
COMPROMISE AND SETTLEMENT. The Trustee shall have the power to compromise, settle, and adjust any claims or demand by or against said trust, on any terms it may deem advisable, and to agree to any rescission or modification of any contract or agreement affecting this trust.
POWER TO BORROW. The Trustee shall have the power to extend or review any existing obligation or obligations as well as to borrow money for any purpose deemed advisable, and to secure the same by the transfer as security therefor any property of the trust or any form of security instrument that is required.
AMORTIZATION. The Trustee shall have the power to purchase securities at a premium without being required to amortize the premium out of subsequent income from the trust.
REGISTRATION OF TRUST SECURITY. The Trustee shall have the power to invest any stock, bonds, or other securities in the name of a nominee, without the addition of words indicating that such security is held in a fiduciary capacity; but accurate records shall be maintained showing that such security is a trust asset and the trustee shall be responsible for the acts of such nominee.
ALLOCATION OF INCOME AND EXPENSES. The Trustee shall have the power to determine what is the corpus and what is the gross net income of the estate and to allocate between principal and income any loss or expenditure in connection with the trust, and if deemed advisable to amortize any loss out of the income.
DISTRIBUTION IN KIND. The Trustee shall have the power to make any and all distribution hereunder in cash or in kind, or partly in cash and partly in kind, and the values it assigns to such distribution shall not be subject to question.
CONTINUANCE OF BUSINESS. The Trustee shall have the power to continue any business, including any partnership in which I may be engaged at my death. If the trustee sees fit, it may incorporate any such business or have the charter of any business already incorporated renewed, the corporation to have such power, such period of existence and its stock to have such attributes as the Trustee in its discretion shall determine, and to form a partnership.
GUARDIAN NOT REQUIRED. When any minor is entitled to a distribution under this trust the Trustee shall not be required to qualify as a guardian or require any other person to qualify as guardian of such minor child, with respect to the distribution to be made to such minor, but may distribute the same to, or for the account of, such minor or to any person having his or her custody without requiring any bond therefor, and without the intervention of any guardian.
MERGER OF TRUSTEE. In the event the Trustee named herein is not a natural person and shall hereafter merge or consolidate with any other bank or trust company or any other corporation that may by law act as trustee, the corporation created by such merger or consolidation shall thereafter acts as Trustee hereunder and shall be subject to all the terms and conditions set forth herein.
COMPENSATION OF TRUSTEE. For the management of this trust, the Trustee shall receive compensation in the sum of $1.00 per month for services as Trustee. However, it is agreed that this fee may be adjusted from time to time in accordance with the amount of work and the responsibility of the Trustee in administering this trust, by a written agreement signed by the grantor of this trust and the trustee, if the grantor is still in life and suffering under no disability. In the event the grantor is dead or suffering under legal disability, then such written agreement must be signed by the Trustee and a majority of the remaining beneficiaries of this trust who are entitled to receive income therefrom and who are then of age and suffering from no legal disability. Such agreement may apply to fees both on income and on principal and the source, principal or income from which such fees shall be paid and shall be binding on all persons taking thereunder.
IN WITNESS WHEREOF, the parties hereto have hereunder set their hands and affixed their seal the day and year first above written.
Sworn to and described before me this ______ day of _______________, 20____.
Witness Notary Public
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