Part 5 – Trust and Trustee Loan Signings (for Notary Signing Agents)
You’ve made it! This is the final article on the series Wills and Estate Documents for Notaries.
Thanks for hanging in there for all five installments–you’ve learned a lot! Today’s article will provide the five top points to remember when you are handling an assignment involving a trust as the principal signer.
Kudos to you for focusing on education. I realize that it’s always more fun and exciting to talk about marketing ideas and making money, but all professions require continuing education and reminders on the pitfalls of their careers. Notaries are no different. For this reason, I encourage notaries to take advantage of the high quality, reasonably priced notary courses provided by Notary.net. Your hiring parties expect you to know how to perform notarial acts and they rely on your expertise.
Non-Loan Real Estate Transactions and Assignments
Before we move forward, I want to mention that the title of the article indicates this is about loan signings. However, it actually applies to real estate transactions where no lender is involved, as well. For instance, a trust could sell property to an individual who brings cash to the closing table. I chose this title because “loan signings” is one of the popular terms that notaries use to search for information on notary signing agent work.
What is a trust?
Let’s get started by learning the meaning of the word “trust.”
A trust, generally speaking, is a legal entity which may also be called a “trust estate.” Trusts are formed through the execution of certain legal documents by a person (or entity) who sets up the trust. There are many reasons to form a trust, but we are not going to cover those because notaries don’t really need that information. Our focus will be how to manage at the signing table.
As with a decedent’s estate, corporation, or other entity type, a trust appoints a representative to sign documents on behalf of the trust.
The representative of a trust is called a “Trustee.” The trustee can be a person or an entity. Some banks have departments that do nothing but administer trusts. Also, more than one person can be a trustee, each of them serving as a co-trustee.
Top 5 Points to Remember When Trusts Are Involved
For this last article in the series, I leaned heavily on my friend, Jake Burkhalter who has a lifetime of experience in title and escrow. I asked him to tell me what is important to know when sitting down with the representative of a trust as the signer of documents. He had enough information for me to fill a small book, so I asked him to boil it down to the top five items he thought notaries should know. These are the points we settled on.
1-Identification requirements are standard. Although a trust is involved, the signer must still be identified through the methods required by your state’s laws.
2-Every transaction is different–do not be afraid to call your hiring party and ask questions! No matter how many times you have completed a trust signing for a lender, the way it is done may change. Approach each one with a fresh look. Ask your hiring party for an answer if you aren’t absolutely sure about something.
3-Don’t assume you know how the documents should be signed. Make sure that you know how the hiring party wants the documents signed. Notes regarding this may be included on instructions in your confirmation or in another document that is provided along with the document package. If you are not given specific instructions on how to have the signer sign, you must call your hiring party. Typical ways for signing are numerous. Here are a couple of examples. (The blue print represents the ink of a handwritten signature.)
Clyde Brown, Trustee of the Donald
Brown Family Trust 11/20/2017
Clyde Brown, Individually, and as Trustee
of the Donald Brown Family Trust 11/20/2017
Clyde Brown, Individually, and as Trustee of the Donald
Brown Family Trust 11/20/2017
4-The trustee’s signatures should be confined to above the lines and out of the 1″ margins around the page. It’s important for the signature block’s printing to be clear and 100% readable. The printing under the signature line is there because it does the job of conveying or encumbering the property, as the case may be.
5-Journal entries should be complete and defining. Know your journal laws well. Unless prohibited by law, you might want to consider not only entering the name of the signer, but also the name of the trust and a few other items. For instance, if the trust is selling or encumbering property, identify the property briefly and to whom it is being sold or the involved lender. Below, are six items that are common to include in a journal entry. However, in the next table are four more items that define the notarial act by associating it with the name of the trust, the property, and additional parties or stakeholders.
Common Journal Notes
|Date / Time
|11/20/2019 5:05 p.m. CST
|Type of Act
|General Warranty Deed
|“Clyde Brown, Trustee” (How the trustee signed.)
|State the method and other information as required by law.
Defining Information for your Journal Entry
|Ronald Brown Family Trust 11/20/2017
|9.554 ac., Lavaca County, Texas, CR 000.
|Joey Doe and Janie Doe
|Include if property is encumbered.
Reasons for adding the last four items —
- The trustee could be a commercial trustee who does this type of transaction frequently.
- The trust may be selling several parcels to several buyers.
- There may be trusts with similar names managed by the same trustee.
More reading —
- Part 1 – Introduction to Wills and Estate Documents for Notaries (PLUS MARKETING TIPS for the fall!)
- Part 2 – Notarizing Wills
- Part 3 – Notarizing a Power of Attorney
- Part 4 – Signing Loan Documents When a Power of Attorney is Involved.
Thank you for your interest in this series! If you have an idea for an article or questions you want to see answered, please post a comment below.