When people in Greensboro, North Carolina want to create a will, they often hear from their estate planning attorney that a trust is, for many situations, a much better option. While you may have heard of a trust before, you may not exactly know how it operates or why it can be beneficial. It’s best to speak to your lawyer about the different kinds of trusts and how you can use them, but it’s good to understand some basic principles before you go into the estate planning process.
Probate
One of the main benefits of creating trust is the ability to avoid having to go through probate. When you create a will and use it to transfer property to others a court has to first validate the will after you die. The probate court is an open court, meaning anyone can inspect your will if they want to. When you create a trust there is no probate requirement, so the trust not only avoids probate costs but also ensures a more private estate.
Property
You can think of a trust as a type of corporation. Like a corporation, the trust doesn’t really physically exist. It exists on paper, but courts recognize it as a legal entity. A trust, also like a corporation, can own property. So, when you create a trust and transfer some of your property to it, the trust becomes the legal owner. You can direct how the trust distributes property after you die without having to go through a probate court.