A statutory trust is an estate planning tool that protects real estate for the benefit of a trust beneficiary. It involves three parties: the grantor, trustee, and beneficiary. Income and sale proceeds go to the beneficiary. The purpose is to protect property for a beneficiary, often a child, and protect it from creditors.
A statutory trust is a type of estate planning tool used to protect real estate for the benefit of a trust beneficiary. With this type of arrangement, three parties are involved: the grantor, the trustee, and the beneficiary. With a statutory trust, any income or proceeds from a sale goes to the beneficiary of the trust. This tool is a way for parents to protect their children’s real estate in the event of their disappearance.
Any legal trust must have three parties involved. The first individual is known as the grantor. This is the person who owns the property that will be put into the legal trust. The grantor forms the trust and transfers ownership of the real estate into the trust.
Another person who needs to be involved is the trustee. This individual is responsible for the property in the trust. The trustee must manage the property and make sure it is cared for for the beneficiary.
The beneficiary is the third party involved in this type of transaction. The beneficiary is generally a child, family member or friend of the grantor and is the individual who will receive any benefits from the property. If the property generates rental income, it will go to the beneficiary. If the property is eventually sold, the proceeds of the sale will also go to the beneficiary.
The main purpose of setting up a legal trust is that the grantor can ensure that a property is protected for the benefit of a beneficiary. In most cases, these are parents who want to ensure that their children have a specific piece of property after their death. With this instrument, the property will be held in the trust and can be transferred to the beneficiary after a certain period of time.
One benefit of this strategy is that the property can be protected from creditors. If the grantor of the trust had outstanding debts at the time of his death, creditors could not come and seek the trust property to satisfy the debt. This allows you to transfer the property and its value to the beneficiary without any problems.
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