I have a living trust done 3/31/95, personal residence under the trust & 2 home as joint tenants ,both 2 homes are under water, one in Vegas & 1 in Stockton,put huge down payment,property lost 70% of original purchase price. I am paying the mortgage thru my trust account,is this legal,if I will apply Modification am required by law to tell the bank about our assets from the trust?..or can I change my revocable trust to irrevocable to protect my remaining assets for our Golden Years? Thank you
Lisa, this is a very good question, and one that I would need more information to properly answer. I can tell you that assets held in a revocable living trust are not protected in any way from creditors – they are protected from probate on your death, and if you become incapacitated your successor trustee can step in and manage them on your behalf without a conservatorship required.
But as far as keeping your trust assets separate and out of the reach of creditors, that is difficult. Yes, there are certain types of irrevocable trusts that can be created to protect assets, but there are strict guidelines for how to set them up, who can be selected as trustee, etc. You really need to work with an attorney who is experienced in this area of law. Feel free to call me if you would like to schedule a consultation to discuss this further. Thanks!
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