Can a VA loan be put in a trust

UPDATED: Sep 30, 2022

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Can a VA loan be put in a trust

My father got a VA loan last year to help my
brother buy a house. My mother who is still
alive and my father have joint title on the
house. My father passed away a few months
ago. What is the best way to put this in a trust
to protect my mom and my brother

Asked on March 16, 2017 under Estate Planning, Alaska


SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 5 years ago | Contributor

A loan cannot be put into a trust, if it was taken out by individuals: it remains their obligation. (In theory, a trust, like an LLC or corporation, could take out a loan, but that is different matter.) If the loan is a mortgage on the property and is not repaid, the lender can foreclose on the house and take it, regardless of whether the home is put into a trust or remains in an individual person's name: an already existing mortgage takes precedence over subsequent transfers of the property and the lender's rights cannot be impaired by putting the property into a trust or otherwise transferring it. The best way to protect against a loan on property is to make sure you pay the loan.

IMPORTANT NOTICE: The Answer(s) provided above are for general information only. The attorney providing the answer was not serving as the attorney for the person submitting the question or in any attorney-client relationship with such person. Laws may vary from state to state, and sometimes change. Tiny variations in the facts, or a fact not set forth in a question, often can change a legal outcome or an attorney's conclusion. Although has verified the attorney was admitted to practice law in at least one jurisdiction, he or she may not be authorized to practice law in the jurisdiction referred to in the question, nor is he or she necessarily experienced in the area of the law involved. Unlike the information in the Answer(s) above, upon which you should NOT rely, for personal advice you can rely upon we suggest you retain an attorney to represent you.

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