Pros and Cons of Putting Your Home in a Trust

For many Americans, their home is their most valuable asset financially and emotionally. So it makes sense to protect it, plan for how it’s passed down, and minimize headaches for loved ones. That’s where a trust comes in.

Putting your home in a trust can offer major benefits, especially when it comes to avoiding probate, protecting your legacy, and ensuring your wishes are carried out. But it’s not always the right move for every homeowner. Let’s break down the pros and cons so you can make the smartest decision for your situation.

What Does It Mean to Put Your Home in a Trust?

When you place your home into a trust, you’re transferring ownership from yourself as an individual to a legal entity (the trust). The trust is managed by a trustee usually you while you’re alive and it names beneficiaries who will receive the home after you pass away.

There are two main types of trusts:

Revocable Living Trust: You maintain full control during your life and can change or revoke the trust at any time.
Irrevocable Trust: Once set up, it generally can’t be changed, and you give up ownership and control but gain potential tax or asset protection benefits.

PRO: Avoids Probate and Speeds Up Inheritance

Probate the court-supervised process for distributing your assets after death can take months or even years. It’s also public and often expensive.

By placing your home in a trust:

Your beneficiaries receive the property without going through probate
There’s no court delay or legal battle over who gets the home
Your estate remains private, not part of the public record

Example: If you die with only a will, your family may have to wait six months or more to legally transfer the home. With a properly funded trust, the transition can be nearly immediate.

PRO: More Control Over Who Inherits and How

Trusts give you flexibility that a simple will doesn’t. You can:

Decide who gets the property and when (e.g., after they turn 25)
Set conditions (such as the home must remain in the family)
Designate a backup beneficiary if your first choice passes away

This is especially useful in blended families, second marriages, or cases where heirs may not be financially responsible.

PRO: Helps Avoid Family Conflicts

One of the biggest benefits of a trust is clarity. It leaves little room for disputes because it’s a detailed legal document spelling out your exact wishes.

A trust:

Names one or more successor trustees to handle affairs
Reduces the risk of siblings or relatives fighting over the home
Avoids common probate issues like contested wills or delayed transfers

Real case: A Florida man’s estate was tied up in court for over a year because his will lacked clear language about a vacation home. A trust could’ve saved legal fees and family stress.

PRO: Asset Protection (in Some Cases)

If you place your home in an irrevocable trust, it may be shielded from certain creditors, lawsuits, or long-term care costs.

That said:

Revocable trusts don’t offer the same protection you still legally own the asset
Irrevocable trusts must be carefully drafted, especially to meet Medicaid eligibility rules

Important: Asset protection isn’t automatic. You need proper legal guidance, especially if you’re concerned about debt, nursing home costs, or future liability.

CON: Upfront Legal Costs and Maintenance

Trusts require legal setup, especially if they involve real estate. While a basic will might cost a few hundred dollars, a trust could run you:

$1,200–$3,000+ for a revocable living trust package
More if it includes complex assets or tax planning

You also have to retitle your home to the trust, which involves:

Filing a new deed with your county
Updating your homeowner’s insurance
Possibly alerting your mortgage lender (some have rules about trusts)

CON: Doesn’t Automatically Protect from All Taxes

While trusts can help with estate planning, they don’t eliminate property taxes, capital gains, or income taxes unless carefully structured.

For example:

If your home is in a revocable trust, it still counts as your property for tax purposes
In some states, transfer taxes might apply when you fund the trust (though this is rare for revocable trusts)
Capital gains taxes could be higher if the home is sold out of an irrevocable trust with a low cost basis

Tip: For most homeowners, the stepped-up basis rule still applies with revocable trusts, minimizing taxes when heirs sell the property.

CON: Not Always Necessary for Simple Estates

If your only major asset is your home, and your state allows Transfer-on-Death (TOD) deeds, you might not need a trust at all.

TOD deeds:

Are simpler and less expensive to create
Also avoid probate
Let you retain full ownership during your lifetime

However, they don’t offer the same level of control or flexibility as a trust especially if you want to leave the home to multiple heirs, protect it from creditors, or control how it’s used.

Who Should Consider a Trust for Their Home?

You may want to put your home in a trust if:

You want to avoid probate and speed up inheritance
You own property in multiple states
You have a blended family or complicated inheritance wishes
You’re planning for long-term care or disability
You want privacy and more control over your estate

A Real-World Comparison

Here’s a side-by-side look at what happens to a home with vs. without a trust:

Situation	Without a Trust	With a Revocable Trust
Time to Transfer Home	6–12 months (after probate)	1–3 weeks
Legal Costs After Death	Higher (probate court, lawyer)	Lower (no probate court)
Public Record?	Yes (probate is public)	No (trust is private)
Flexibility in Distribution	Limited	High (custom terms allowed)
Family Disputes	More likely	Less likely

Final Thoughts

Putting your home in a trust can be one of the most powerful estate planning tools especially if you want to make life easier for your loved ones, keep your affairs private, and avoid court costs. But it’s not a magic solution for everyone.

If you’re unsure whether a trust is right for you, consider speaking with an estate planning attorney who understands your state laws and personal goals.

You don’t have to be wealthy to plan wisely you just need to get started.

Up next: How to Handle Inherited Property With Siblings — Learn how to divide, sell, or share a family home without breaking family bonds.