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How to Sell a House in a Trust in Texas: Step-by-Step Guide from The Lange Firm

Selling real estate can be complex—but when the property is owned by a trust, the process involves even more legal considerations. Whether you’re a trustee, a beneficiary, or someone managing a loved one’s estate, understanding how to sell a house in a trust is essential to protect your interests and comply with Texas law.

At The Lange Firm, we assist clients throughout Texas in trust administration and real estate transactions involving trusts. In this comprehensive guide, we’ll explain:

• What a trust is and who has the authority to sell

• The step-by-step process to sell a house held in a trust

• Tax and title implications

• Special considerations for revocable vs. irrevocable trusts

• How The Lange Firm can assist in avoiding delays or disputes

What Is a Trust?

A trust is a legal entity that holds and manages property on behalf of a person (the grantor) for the benefit of another person (the beneficiary). It’s administered by a trustee, who is legally responsible for managing the trust’s assets according to the trust’s terms.

There are two main types of trusts:

• Revocable Living Trusts: Created during the grantor’s lifetime and can be changed or revoked.

• Irrevocable Trusts: Cannot be modified once established and often used for asset protection or estate tax planning.

The way a home is sold from a trust depends on what kind of trust it is and who currently serves as the trustee.

Can a House in a Trust Be Sold in Texas?

Yes—but only by someone with legal authority. Typically, this means the trustee must:

• Be properly appointed under the trust document

• Follow any conditions or restrictions in the trust agreement

• Act in the best interests of the beneficiaries

If you’re unsure whether a trust allows the sale of a property, The Lange Firm can review your trust documents and provide legal guidance.

Step-by-Step: How to Sell a House in a Trust

✅ Step 1: Review the Trust Document

The trustee must first confirm that the trust permits the sale of the property. Key clauses to look for include:

• Sale authorization language

• Beneficiary approval requirements

• Special instructions or timing restrictions

Failing to follow the trust’s terms can result in legal consequences for the trustee.

✅ Step 2: Verify Title Ownership

Next, confirm that the property is titled in the name of the trust. The deed should read something like:

“John Doe, Trustee of the Doe Family Trust, dated January 1, 2020”

If the title wasn’t properly transferred to the trust, the house can’t be sold from the trust until a title correction is made. The Lange Firm assists with retitling issues and trust funding corrections.

✅ Step 3: Get Beneficiary Consent (If Required)

Some trust documents require the trustee to notify or obtain approval from beneficiaries before selling the home. Even when not legally required, it’s often smart to communicate openly to avoid disputes.

✅ Step 4: Hire a Realtor Familiar With Trust Sales

Selling a house from a trust involves nuances that not all realtors understand. Choose a listing agent experienced in:

• Trust or estate property sales

• Probate and non-probate real estate

• Coordinating with attorneys and title companies

✅ Step 5: Set a Fair Market Price and List the Home

The trustee has a fiduciary duty to get a fair price for the home. This may involve:

• Getting a comparative market analysis (CMA)

• Ordering an appraisal

• Considering repairs or staging for higher sale value

At The Lange Firm, we guide trustees through asset valuations and documentation.

✅ Step 6: Accept an Offer and Execute the Sale Contract

The trustee signs the sales contract on behalf of the trust, not in their personal capacity. For example:

“John Doe, as Trustee of the Doe Family Trust, under trust dated 1/1/2020”

The buyer must be informed that the seller is a trust, which may influence closing timelines.

✅ Step 7: Clear Title Issues and Close the Sale

Before closing, the title company will:

• Review the trust document

• Verify the trustee’s authority

• Request a Certificate of Trust or Affidavit of Trust

The Lange Firm works closely with title companies to ensure all legal documents are in order.

✅ Step 8: Distribute or Retain Sale Proceeds According to the Trust

Once the sale closes, the proceeds go to the trust, not the individual trustee or beneficiaries directly. The trustee must then:

• Pay off any liens or debts

• Deposit funds into the trust account

• Distribute or reinvest funds as required by the trust document

Failure to handle proceeds correctly can result in legal liability.

Selling a House After the Grantor Dies

If the grantor has passed away, the successor trustee takes over. Here’s what changes:

• The trust becomes irrevocable (if it was revocable)

• The trustee must act on behalf of the deceased’s estate

• Selling the home may be part of trust administration or distribution

In many cases, the home sale may also trigger capital gains tax implications, which should be reviewed with an attorney or CPA.

Does Selling a House From a Trust Require Probate?

No—if the house is titled in the trust’s name, probate is not necessary.

However, if:

• The home was never titled in the trust

• The trust is missing required terms

• The trust was never properly executed

… then probate may be necessary to transfer title. This is why funding the trust correctly is vital—something The Lange Firm helps clients handle during estate planning.

Tax Considerations When Selling a House in a Trust

Depending on the trust and the timing of the sale:

• Capital gains tax may apply

• Step-up in basis may reduce tax owed (if sale occurs after death)

• Irrevocable trusts have different tax brackets and filing requirements

• Grantor vs. non-grantor trust status affects reporting

We work with financial advisors to create coordinated plans for real estate held in trusts.

How The Lange Firm Can Help

At The Lange Firm, we help:

• Trustees navigate real estate transactions

• Families resolve disputes among beneficiaries

• Title companies get the documents they need

• Executors coordinate trust and probate duties

• Sellers avoid unnecessary taxes or legal exposure

Whether you’re setting up a trust, managing one, or preparing to sell a trust-owned property, we’re here to help.

Final Thoughts: How to Sell a House in a Trust in Texas

Selling a house that’s held in a trust involves more than just listing and closing. It requires:

• Reviewing the trust

• Verifying ownership

• Acting in compliance with fiduciary duties

• Filing accurate documents and tax reports

📞 Ready to sell a trust-owned home? Contact The Lange Firm today for a consultation. We’ll help you navigate the process, protect your interests, and avoid costly mistakes.