The choice to sell our houses comes down to diverse reasons. Maybe you’re trying to pay off debt or fund a family vacation. You may also be looking to downsize or relocate to a different city.
For starters, you can sell your Colorado springs house and get an excellent price. Also, if you’re a trustee, you may consider selling a home in your trust for cash. However, you need to consider the various rules that apply to trusts. Let’s examine the aspects you should consider and why a cash sale could make sense.
Variables To Consider
A trust is a juridical entity allowing a trustee to possess and manage the property on behalf of someone else (the beneficiary). It also establishes the trustee’s legal responsibilities when managing or selling the property. Most importantly, if you plan to sell property in a trust, you should have one goal: to benefit the beneficiaries. Also, consider the following factors:
- The trust’s financial situation
- State and local laws governing trusts
- Tax implications
- Restrictions imposed by the trust deed
The type of trust and the beneficiaries it serves determine the steps you must take to facilitate a cash sale. For instance, revocable trusts do not require court approval to sell property – the trustee can go ahead and close the deal and put the proceeds in the trust. Conversely, an irrevocable trust requires court approval or the beneficiaries’ consent before you can sell the property in question.
Reasons for Selling the House
So, why would you want to sell a house in a trust? Well, if the house is in a state of disrepair, and you don’t plan to repair it, you may want to sell and get some cash for it. Maybe a storm tore through it, leaving it uninhabitable, or you can’t afford to repair it.
The house could also be showing its age, making it expensive to maintain. Also, selling the house might be a feasible option if it is subject to excessive liens and debts. This approach allows you to pay off creditors while ensuring the beneficiaries get a slice of the pie.
Furthermore, a sale may be more practical if the estate is too large to manage. Likewise, selling a home in your trust can help reduce taxes (in some cases) and give beneficiaries control over the assets in the trust.
Or perhaps the unit is a rental property the beneficiaries cannot manage or prefer not to handle. If you’re also unwilling to take on the legal responsibilities therein or the financial pressure of managing the property, you may consider selling it.
Why Go for a Cash Offer?
Picture this; you got consent from the beneficiaries to sell the house in the trust. You put the house up for sale a few moons ago, but no fish is biting. You’re frustrated, and, in turn, the beneficiaries aren’t getting their money either.
A cash offer might be a feasible option when such a scenario plays out. You can get a fair cash offer immediately, complete the sale, and put the cash in the trust per the terms of the deed.
You may even get a higher price depending on factors such as the condition of the house, location, special features it may have, or the current real estate market. Here’re the other potential benefits of such a move:
- Selling As-Is – selling for cash means you don’t have to deal with the hassle of repairs. The buyer makes an offer, and you get the money without much fuss.
- Faster Closing – a cash sale eliminates contingencies, making the transaction faster and more efficient. Thus, you don’t have to deal with an agent or worry about inspections, appraisals, staging, listing, or other elements that usually slow down the process. For instance, if you are selling a house in your trust on behalf of an elderly relative, they may need faster access to the funds than other routes provide. Therefore, it may be wise to choose cash rather than drag through a lengthy closing process.
- No Commissions – whenever real estate agents are in the picture, expect to pay them a commission for their services. Cash sales cut off these middlemen, meaning no fees or need to pay extra closing costs.
If a trust grants you (the trustee) the authority to sell a house, you can explore various options. Even so, a cash sale offers a viable and faster solution than other methods. If this is your preferred route, give thought to the legal framework governing trusts and the beneficiaries’ needs before committing to the sale process.
