How does a living trust avoid probate?
Property you transfer into a living trust before your death doesn’t go through probate. The successor trustee (the person you appoint to handle the trust after your death) simply transfers ownership to the beneficiaries you named in the trust. In many cases, the whole process takes only a few weeks, and there are no lawyer or court fees to pay. When the property has all been transferred to the beneficiaries, the living trust ceases to exist.
Property you transfer into a living trust before your death doesn’t go through probate. The successor trustee—the person you appoint to handle the trust after your death—simply transfers ownership to the beneficiaries you named in the trust. In many cases, the whole process takes only a few weeks, and there are no lawyer or court fees to pay. When all of the property has been transferred to the beneficiaries, the living trust ceases to exist.
This is where a Living Trust earns its value. A Living Trust does not save you penny while you are alive, but after death they can eliminate the need for probate — and most importantly, probate fees and estate taxes. With a Living Trust, your surviving family members can transfer your property quickly and easily, without probate. More of the property you leave goes to the people you want to inherit it.
A living trust avoids probate by changing ownership of the assets during your lifetime. Then, when you pass away, there are no assets in your name alone which require probate administration. Think of it this way: while you are alive any assets which you own in your own name can be transferred by you at any time. This is one of the rights of being an owner. But, when you pass away, you are no longer here to change the ownership, so only the probate court can change the ownership for you. By creating a living trust, a trust set up during your lifetime, you change the ownership of the asset and preclude the need for the probate court to do so.
