A living trust is also known as a trust “inter vivos”. It is an agreement that takes effect at a specific or specified date, even when the trustor/testator is still alive. As a general rule, a trust is an agreement between 2 persons for the benefit of a third person.
For example, Mr. A writes a living trust naming Mr. B as the owner and manager of Company ABC. The condition is that Mr. B gives to Mr. C, who is the minor child of Mr. A, a certain percentage of the profits of the company. Mr. C. In this example, Mr. A is the trustor, or the person who creates a trust. Mr. B is the trustee, the person who is given an obligation to take care of something. Mr. C is the beneficiary.
Is it Legal to Write Your Own Living Trust?
Yes it is. Provided you comply with the substantial requirements for the same. Aside from the formal and substantial requirements of the law, you also need to make sure that the terms of the trust provide maximum advantage. In this regard, it is recommended to consult with a Los Angeles estate planning law firm.
What Advantage Could You Possibly Get?
There are several advantages to a living trust. First and foremost it avoids the delays and the complications that can arise during the probate of a will. These can prove costly, both in terms of profits and the actual property put in trust.
For example, if during the probate of the will, the ownership and control of the property and its profits are contested, the management of the same maybe affected. So much so that certain profitable acts cannot be continued. Not unless the dispute is resolved. By instituting a living trust the property is not included in the probate. And the trustee is allowed exercise full powers, as provided in the trust agreement.
Is there a Disadvantage?
There are a few. A living will is usually more expensive and requires the intervention of a Los Angeles estate planning lawyer. Of course you can write the trust yourself, but it is still better to consult with a lawyer first.
What Could Happen if You Write an Invalid Living Trust?
The answer depends on the ground for invalidity. If the failure is minimal and merely procedural, the court may disregard the same and require the necessary and appropriate corrections be made. If the failure is substantial then the entire agreement may be voided.
For more information it is best to consult with a Los Angeles estate planning lawyer. Tip: there are law firms out there who provide free consultations. So there is no excuse not to make the extra effort.