Most lawyers recommend that your homestead not be titled in the name of your living trust

Attorney Tom Olsen: Beau, you're on WDBO. Go ahead.

Beau: Good morning, Tom. I was just listening to the segment on homestead exemption and protection from creditors. My homestead is held within a revocable trust and I am the trustee. Do I enjoy the protection from creditors, with my homestead being held in a revocable trust?

Tom: Most attorneys would tell you that that is a bad idea. Most attorneys would tell you that your revocable living trust should not own the title to your home that you live in. Rental properties, investment properties, vacation home, vacant lots, yes. The home you live in, not a good idea.

Beau: Okay, thank you very much.

Tom: All right. You're welcome, Beau. I've been doing living trust since 1990. I've been doing them for 30 years. During that entire 30 years, lawyers generally have not been putting people's homes into the name of their trust, for this very fear that if they do so, if Beau got sued, was in a terrible automobile accident, worked up a million dollars in medical bills, et cetera, and somebody sued Bob, they could now go after his home, which is normally protected from creditor claims.

If it's owned by his trust, it may not be protected from creditor claims. That's why we don't do it. We use a hybrid method, which is a Ladybird deed that continues to get Beau protection from creditor claims, and is a tool to avoid probate at the same time.

Attorney Christine Merrill: Correct. The Florida constitution, which gives this protection, which is really a significant protection for all Florida homeowners for the homestead, here's why. Here, in the state of Florida, which is the highest protection of any state in the country, it is unlimited. Number one. Number two, the constitution says it has to be in individual names. That interpretation, where now it's listed in a trust, that is the part where most attorneys, like you said, would interpret the way we do, and that they would say it is now not owned by an individual person.

Tom: Folks what we're saying is, in the state of Florida, the home you live in, your homestead, is protected from creditor claims, doctors, hospitals, credit cards, automobile accidents, bankruptcy, nursing homes, you name it, it is protected. If you transfer the home out of your individual name and it is in fact now owned by your living trust, you will lose your protection from creditor claims, and that's why lawyers don't do it. There are other tools to avoid probate on your home, that we can use.

Generally, not a good idea to have it owned by your trust. My name is Tom Olsen. The name of the show is Olsen on Law.

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