Real Estate in Other States and Countries-Trusts
If your residence is North Carolina, and if you own real estate in another state or country, you should give serious consideration to creating a Revocable Living Trust (RLT) and transferring the title to that real estate to the RLT. Many people own vacation homes, condominiums, or time-shares in South Carolina, Tennessee, or Florida, but the location of your real estate could be almost anywhere. Maybe you moved from California and still own real estate there that you rent out. Maybe you own a time-share or condominium in Hawaii, Mexico, or the Caribbean. Maybe you still own real estate in the U.K., Germany, or elsewhere.
I will touch on some of the problems involved in transferring title to out-of-state or out-of-country real estate to an RLT, but first I will mention the reasons for doing it. As with any other asset, the use of an RLT can avoid the court system in the form of guardianship and probate proceedings. In the case of out-of-state or out-of-country real estate, these proceedings would be conducted in those other jurisdictions in addition to proceedings in NC. Even though it might not be necessary to duplicate every bit of the proceedings in NC in the other jurisdictions, having your surviving spouse or children dealing with multiple jurisdictions when you have recently become incapacitated or died is something to be avoided if at all possible. If your RLT owns the property when one of these events occurs, the burdens that fall on your family will be greatly reduced.
So what are the difficulties or disadvantages? As with any asset transfers to an RLT, there is something that you need to do now in order to simplify things for your family later. Whatever you need to do now, rest assured that it will be much easier for you than what they would need to do later if you do nothing now. If the transfer of your own property in another jurisdiction involves difficulties, how much more difficult will it be for your family to transfer the property through a court proceeding? For you to transfer real estate located in a state other than North Carolina to your RLT, all that is required is a deed from you to your trust. This probably will mean paying a lawyer in the other state to prepare the deed and file it in that state, but this is a minimal cost. If you out-of-state property is a time-share, a deed might or might not be required, depending on the laws of the other state and your exact situation. If you own real estate in another country, the requirements for transferring the property to an RLT will be more complicated, if it is even possible. Again, though, if it is difficult for you to transfer your own property now, how much more difficult would it be for your family to deal with a court system in that other country when you are no longer able to do it?