Should I Put My House in a Living Trust? Ask the Concierge

Ask the Concierge is a reader-question column. Letters are edited and details changed. General educational information, not legal or tax advice. I'm a real estate broker, not an attorney; the decisions below belong with an estate planning attorney licensed where you live.

Dear Concierge,

My husband and I are in our late sixties in Upper Marlboro. The house is paid off. Our daughter is in Bowie and our son is in Alexandria. An attorney we met at a seminar said we should put the house in a living trust so the kids "don't have to go through probate." We nodded, and then we got home and realized we didn't really understand what we'd be doing to our own deed. What actually changes? And is there a catch?

Nodding in Upper Marlboro

Dear Nodding,

The attorney was probably right, and you were right to come home and ask. I see trust-held property at closings every month, and the families who understand what they set up have easier transactions than the ones who signed at a seminar. So here is what a living trust does to your house, in the order the questions usually come up.

Who's who

A living trust, sometimes called an inter vivos or revocable trust, is created while you're alive, as opposed to one that springs from a will after death. In the typical family version, you and your husband are all three roles at once: the settlors who create it and put the house in, the trustees who manage it, and the beneficiaries who get to live in it. Your daughter and son are named as successor trustees and as the beneficiaries after you're both gone. While you're alive, nothing about your daily life changes. You can sell, refinance, rent it out, or take the house back out of the trust entirely. That's what "revocable" means.

What actually happens to the deed

This is the part most people get wrong. The trust doesn't own your house. The trustee holds title on behalf of the trust. Your attorney records a new deed transferring the property from "Robert and Denise Smith" to "Robert and Denise Smith, Trustees of the Smith Family Trust dated such-and-such." Same people, new capacity.

In Maryland, a deed into your own revocable trust is generally exempt from state and county transfer and recordation taxes, because you're not really selling anything to anyone. In Prince George's County that matters; those taxes on an ordinary sale run into the thousands. Your attorney will cite the exemption on the deed. The District and Virginia have their own exemptions for the same move; confirm with counsel in that jurisdiction.

What you avoid: probate

This is the real reason your attorney brought it up, and it's a good one.

When a Maryland homeowner dies with the house in their own name, the house goes through the Register of Wills and Orphans' Court in the county where they lived. Even an uncontested estate takes months, sometimes longer than a year, and the house can't be sold or refinanced cleanly until the personal representative is appointed. I've watched a Bowie family carry a vacant house through two winters waiting on letters of administration. The District's Probate Division and Virginia's circuit court clerks run their own versions of the same process.

A house held in a living trust skips it. When the second of you passes, your daughter, as successor trustee, records a short document, and she can list the house that month. That's the whole pitch, and for most families it's worth the cost of setting up the trust by itself.

What you probably don't avoid: taxes

Here's where seminar pitches get slippery, so let me be plain. A revocable living trust does not, by itself, reduce estate taxes. The house is still yours for tax purposes while you're alive; it's still counted in your estate when you die.

Whether that matters depends on how much you have. For 2026 the federal estate tax exemption is $15 million per person. Maryland's own estate tax kicks in at $5 million, a number that hasn't moved since 2019. The District's threshold is just under $5 million. Virginia has no estate tax at all, which your son in Alexandria may find relevant someday.

Then there's the one people forget: Maryland is the only state with both an estate tax and an inheritance tax. The inheritance tax is 10 percent of what's received, but it doesn't apply to spouses, children, grandchildren, parents, or siblings. So a house going to your daughter and son owes none of it. A house going to a niece, a longtime partner you never married, or a friend owes 10 percent, and no trust changes that.

The other thing a revocable trust preserves is the step-up in basis. Your kids inherit the house at its value on the day you die, not what you paid in 1988, which is usually the biggest tax benefit in the whole plan. Irrevocable trusts and lifetime gifts can lose that. Ask about it specifically.

Your Homestead credit survives

Maryland homeowners worry about this one, and the answer is good. Since 2014, a principal residence titled in a trust still qualifies for the Homestead Tax Credit, the cap on how fast your taxable assessment can rise, as long as you're living there without paying rent to the trust. After the new deed records, look your property up on the SDAT real property page and confirm the Homestead status still says approved. If it flipped to "no application," refile. Same principle for the senior and homeowners' credits many Prince George's County retirees receive.

Your mortgage, if you had one

You don't, but your daughter might ask for her own house. Federal law prevents a lender from calling a loan due just because you moved a home you live in into your own revocable trust. And a trustee can generally borrow against or refinance trust property if the trust document allows it, which the standard family trust does. Fannie Mae and Freddie Mac both accept loans on homes held in revocable trusts; the lender will ask for a trust certification and possibly a rider. Not every lender is set up for it, so say "the house is in a trust" on the first phone call, not at closing.

Title insurance and selling later

When you bought, you got an owner's title policy. Re-titling into a trust can affect who that policy covers. Ask your title insurer for an endorsement naming the trustees, or confirm coverage continues. It's a phone call, and it's the step most attorneys' deed packages skip.

When the house eventually sells, the title company will want the trust document or a certification of trust, proof of who the current trustee is, and, if a settlor has died, a death certificate. Keep those in a folder with the deed. The families who can produce that folder close on time.

Now, the letter with the wrong idea

Dear Concierge,

I don't want my name showing up on public records as the owner of an investment property in Hyattsville. My cousin is willing to take title "in trust" for me and we'd sign a private agreement between us. Would a title company go along with that?

Private in Hyattsville

Dear Private, a title company might record it. That is not the same as it being a good idea, and I'd tell you not to do it.

Whoever holds title of record is the only person who can sell that property, borrow against it, or lose it. If your cousin decides to refinance, gets sued, gets divorced, or dies, the house is in his name and your private agreement is a piece of paper you'd have to litigate to enforce. Title insurance protects against defects in the title. It does not protect you from your own trustee doing something you didn't authorize. Depending on why you want your name off the records, the arrangement may also be illegal.

If privacy is the goal, that's what a properly drafted trust with a neutral name, or an LLC, is for, done with a lawyer and reported correctly. If the goal is hiding the asset from a creditor, a spouse, or a lender, no honest professional can help you with that, and I won't.

The short version, Nodding

Do the trust. Make sure the deed cites the Maryland transfer tax exemption, check the Homestead status after it records, get the title endorsement, and put the trust paperwork in a folder your daughter knows how to find. Then don't think about it again. That's the whole point.

Travell

Have a question for the column?

If you're the adult child who's just become trustee of a parent's home in Prince George's, Montgomery County, the District or Northern Virginia and you need to sell it, the 60-Second Smart Selling Options guide lays out whether to prepare it, fix only what matters, sell as-is or take a cash offer, with what each costs. Request a Home Wealth Snapshot for a current value first; you'll need that number for the estate anyway.

If you're buying a home that's held in a trust, the 60-Second Buyer Guide covers what to ask for early so the trustee's paperwork doesn't hold up your settlement.

Travell Eiland, Broker Associate, The Concierge Agency. Making Real Estate Dreams Come True.