Why does the bank need a copy of your living trust?

A revocable living trust is a legal vehicle into which you can transfer your assets and other property for the purposes of estate planning. Establishing a revocable living trust has several benefits for the grantor or trust creator:

  • Avoids the necessity of going through the probate process
  • Trust documents are not a matter of public record
  • Can be undone or altered during the grantor or creator’s lifetime
  • Trust’s successor trustee can manage the trust in case the grantor becomes incapacitated

Upon establishing your living trust, you will transfer your assets and property into the trust in order to “fund” it, including checking and savings accounts as well as safe deposit boxes.  Your signature will be required by whatever financial institution you are dealing with in order to complete the transfer.

When at the bank to transfer assets, you should have a “Certificate of Trust” or a summary of the trust that proves you are the grantor. That summary should include the exact name of your trust, the names and addresses of the trustee and successor trustees, and the date that the trust was established. 

Why then do some people end up calling their attorney to ask them “why does the bank need a copy of my trust?” The answer to this is–they don’t. Other than the information that is found in the Certificate of Trust or a similar document — the Memorandum of Trust — your bank does not need to know any more details of the trust.

For this and any other questions about trusts, please check with your attorney.

Who should have a copy of your trust?

There is no real legal answer to the question of who should have a copy of your trust.  The answer usually has more to do with the dynamics of your family and your living situation. In the end, it’s really up to you to decide who has a copy of your trust.  

You should give copies of the trust document to whoever is your power of attorney and your successor trustee. You may also want to give a copy to your beneficiary or heir unless you feel that it could result in conflicts among family members.

Keep the original documents in a secure place in your home along with other important documents such as car titles, passports, and insurance policies. And make sure that some family members know where to find them!

Where is your trust?

What recourse do you have if you can’t find the original trust documents or if it cannot be located after your death? Once you have made copies and given one to your successor trustee, beneficiaries, or heirs, or ended up giving a copy to the bank, this will ensure that your wishes will be honored after your death.

If you cannot locate your original documents, you will need to revoke the lost trust and create a new one to replace it. Contact one of our attorneys to help you with all things living trust and estate planning for California.