Irrevocable Trusts
Finance your home with title in the name of your irrevocable
Trust
Title may be held in an irrevocable trust for residential one to four family
homes and condominiums financed with a portfolio loans up to 80% loan to value
ratio. Use of property may be owner occupied, second home or investment. If the property is going to be rented,
investment rates do apply. The maximum loan amount for this type of
vesting is $3,000,000.
An irrevocable trust generally cannot be amended or
revoked, even by the trustor, settler, grantor, or creator. The trustor of this
type of trust relinquishes control over trust property and no longer has
ownership interest in the trust assets. The trustee administers the trust
property according to the terms of the trust and in the sole interest of the
beneficiaries.
There are several types of Irrevocable Trusts.
Qualified Personal Residence Trusts
Illinois Land Trusts
Massachusetts Realty Trusts
Typically, the trustor gives up control of the property in
trust. Lender requirements include review and approval of all trust
documents. The trust must identify all active trustees and beneficiaries.
The trustees (except for Illinois Land Trusts) must be individuals.
Beneficiaries must be adults.
The trustees must be authorized to mortgage the property.
The transaction itself must be allowed under the terms of the trust (purchase of
second home or other non-income producing property). If funds are being
obtained in a refinance transaction, the use of those funds must be allowed by
the trust documents.
The lender's rights cannot be restricted and there cannot
be excessive servicing requirements.
Above is a brief summary of lender requirements, additional
requirements, limitations and restrictions may apply.
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