Can I Put My House in a Trust in Tennessee? A Lawyer's Honest Walkthrough

The house question arrives in our Nashville office almost every week. A Middle Tennessee couple in their sixties has paid the mortgage down, watched the home appreciate past $500,000, and started to think about what happens to the house when one of them is no longer here. A widow with a single adult daughter wants to know whether the online trust services that keep advertising on her phone are worth the price for the home. A daughter sitting next to her father, who has been diagnosed with early dementia, wants to know whether she can move the house into a trust before the nursing home bills arrive.

Each of them is asking some version of the same question: can I put my house in a trust in Tennessee. The honest answer is yes, with the Tennessee statutes that govern how, the Tennessee facts that decide whether you should, and the Tennessee mistakes that cost families the most. This article is that walkthrough in writing. It covers what the trust does and does not do for a Tennessee home, the revocable versus Medicaid Asset Protection Trust comparison the marketing rarely makes clean, the federal mortgage protection that keeps the lender from accelerating the loan, the TennCare estate recovery limits, the deed-recording mechanics, the real Tennessee cost ranges, and the common errors we fix in our office every year.

Can I put my house in a trust in Tennessee?

Yes, you can put your house in a trust in Tennessee. Tennessee law permits a homeowner to transfer real property into a revocable living trust or an irrevocable trust under the Tennessee Uniform Trust Code at Tenn. Code §35-15, by executing and recording a deed that conveys the home from the homeowner in the individual capacity to the homeowner as trustee. Tenn. Code §66-5-103 governs deed execution. The mortgage does not accelerate, under the Garn-St Germain Depository Institutions Act, when the home moves into a revocable trust where the borrower remains a beneficiary and an occupant.

That paragraph is the answer to the search. The rest of the article is the substance behind it.

The two trust structures Tennessee homeowners actually use

Two structures do most of the work for a Tennessee home. The first is a revocable living trust, drafted under Tenn. Code §35-15, where the grantor serves as the initial trustee, retains the power to revoke or amend, and names a successor trustee to take over at incapacity or death. The home sits in the trust, the grantor still lives in it, still pays the property tax, still claims the homestead exemption, and still treats the house as the residence for income tax purposes. At the grantor's death, the home passes to the named beneficiaries without a Tennessee probate filing.

The second is a Medicaid Asset Protection Trust, a separate irrevocable structure drafted under Tenn. Code §35-15 and coordinated with the federal grantor-trust rules in Internal Revenue Code §677, where the grantor relinquishes the power to revoke and cannot serve as trustee. The home moves into the MAPT by deed, and after the five-year TennCare look-back has run, the home sits outside the look-back, outside the asset calculation, and outside the probate estate that TennCare estate recovery reaches under Tenn. Code §71-5-116. The MAPT is a different document from the revocable trust, with a different set of tradeoffs.

A third structure, the Tennessee Domestic Asset Protection Trust under the Tennessee Investment Services Act at Tenn. Code §35-16, is sometimes used to shield a home from future commercial creditors. It is a self-settled irrevocable trust with a Tennessee trustee, and it is the right tool when the asset-protection concern is professional liability, divorce, or business creditors. It is not a substitute for the MAPT in the Medicaid context. For the full DAPT walk-through, see our asset protection trusts page.

What changes when you transfer your home, and what does not change

Most of the things a Tennessee homeowner worries about do not actually change when the home moves into a properly drafted revocable trust. The grantor still owns the home for daily purposes. The homestead exemption is preserved. The property tax bill comes to the same address. The mortgage stays in place. The homeowners insurance is endorsed to add the trustee as an additional insured. The capital gains exclusion under Internal Revenue Code §121 for the sale of a principal residence is preserved when the trust is a grantor trust under §671 through §679, which every revocable trust is by definition.

What does change is the title of record. The deed of record at the register of deeds office for the county where the property sits now reads "Knight Lancaster, as trustee of the Lancaster Family Revocable Trust dated ______," rather than "Knight Lancaster." At death, the successor trustee delivers a trustee's deed to the named beneficiary or sells the home and distributes the proceeds, without opening a Tennessee probate file.

Is it a good idea to put your house in a revocable trust?

For most Tennessee families who own a home and have any meaningful expectation of a long decline or want to avoid a public probate, putting the house in a revocable trust is the right move. For a real share of Tennessee families, it is not, and the honest "no" cases deserve to be named with the same care as the "yes" cases.

When it is a yes for a Tennessee family

Five fact patterns push hard toward yes.

The first is a Tennessee family with the home as the largest asset. Real estate is the single most common reason a Tennessee family ends up paying for a trust. A home titled in the deceased's individual name runs through Tennessee probate before the heirs can sell or refinance it, with 9 to 14 months for an uncontested estate based on attorney observation of court process, several thousand dollars in clerk fees, publication costs, and attorney fees for the personal representative, and a public record of who got what. A home titled in a funded revocable trust passes to the successor trustee at death without any of that.

The second is a blended family. A second marriage with adult children from a prior marriage is exactly the fact pattern where the revocable trust does the work the will alone cannot. The trust can hold the home for the surviving spouse's lifetime use and then pass it to the grantor's children at the surviving spouse's death, with the terms inside the trust controlling, not the surviving spouse's will.

The third is a Tennessee family with out-of-state real estate. A vacation home in Florida, a hunting tract in North Carolina, or a rental in Alabama titled in an individual name at death triggers a second probate proceeding in that state, called ancillary probate, with its own clerk fees and its own attorney. The same property titled in the Tennessee revocable trust avoids the second probate entirely.

The fourth is a Tennessee family with a real expectation of incapacity. Dementia, stroke, and long-term illness do not respect a will. A funded revocable trust paired with a durable financial power of attorney lets the named successor trustee step in and manage the home through a long decline without a Tennessee conservatorship. The successor trustee can pay the mortgage, deposit the deposits, sell the home if needed to fund care, and otherwise act as the owner would have acted.

The fifth is a Tennessee family that values privacy. A Tennessee probate file is a public record. The inventory, the list of beneficiaries, and the value of the estate sit in the clerk's office and can be read by anyone who walks in. A funded revocable trust keeps the entire transfer outside the public record.

When the answer is no, in spite of the marketing

Three fact patterns push hard toward no.

The first is a married Tennessee couple already holding the home by tenancy by the entirety, with no children from prior marriages and no out-of-state property. At the first death, the home passes to the surviving spouse by right of survivorship outside probate, with no court involvement. At the second death, the surviving spouse can fund the home into a single-grantor revocable trust if they want to, but funding it during the first spouse's life adds cost without adding meaningful benefit during the entireties period.

The second is a Tennessee family with a non-conforming mortgage from a lender that mishandles trust deeds. The federal protection in Garn-St Germain at 12 USC §1701j-3(d)(8) is clear. Some loan servicers and some smaller portfolio lenders still raise the due-on-sale clause when a deed shows the trust as the grantee. Most fix the mistake when the borrower's attorney sends a copy of the statute. A few will demand the borrower deed the property back out of the trust as a condition of continuing the loan. Knowing the lender before the transfer is part of the work.

The third is a Tennessee family whose only assets pass by beneficiary designation or joint title and whose home would qualify for the small-estate path. A retired homeowner with a single primary heir, a paid-off home below the median, and accounts that already pass by beneficiary designation may not need the trust at all. The revocable trust is a real tool, and it is the wrong tool when the family's situation does not require it.

Garn-St Germain and the mortgage acceleration question

The single most common question we hear about the home-in-trust step is whether the mortgage will accelerate. The federal answer, under the Garn-St Germain Depository Institutions Act §341(d)(8), codified at 12 USC §1701j-3(d)(8), is no. The federal statute exempts a transfer of an owner-occupied residential property of fewer than five dwelling units into a revocable inter vivos trust where the borrower is and remains a beneficiary of the trust and where the transfer does not relate to a transfer of rights of occupancy in the property. That is the statutory text, and it covers the typical Tennessee home-in-trust transfer. The lender cannot call the loan due. The amortization schedule, the interest rate, and the maturity date all stay where they were.

Notifying the lender is still good practice. The notification is a short letter to the loan servicer, with a copy of the recorded deed and a copy of the trust certificate, advising the servicer of the transfer and citing Garn-St Germain. Most servicers update their records and continue billing under the same loan number. A handful ask for additional paperwork. None should accelerate the loan if the transfer complies with the statute.

Title insurance treatment in Tennessee

Most Tennessee title insurers issue an endorsement that continues the existing owner's title insurance coverage when the home moves into a revocable trust where the grantor is the trustee and a beneficiary. The endorsement is short and inexpensive, and we order it as part of the funding work at Lancaster Law. Failing to order the endorsement does not necessarily void the coverage, but the cleaner record is to capture the endorsement when the deed is recorded.

Should you put your house in a will or a trust in Tennessee?

For most Tennessee families with a home, the trust is the better tool. The reasons turn on three Tennessee-specific facts: how Tennessee probate handles a home, how Tennessee has not adopted the Uniform Real Property Transfer on Death Act, and how the federal Garn-St Germain Act protects the existing mortgage when the home moves into a revocable trust.

The Tennessee probate math for a $400,000 home

A Tennessee home titled in the deceased's individual name runs through Tennessee probate before the heirs can sell or refinance it. The clerk charges filing fees. The personal representative posts notice to creditors and waits the statutory period. The personal representative's attorney bills for the work. The estate cannot list the home for sale until the executor is empowered by Letters Testamentary. For a typical $400,000 Middle Tennessee home, the probate administration takes 9 to 14 months for an uncontested estate, 9 to 18 months for a contested or intestate estate based on attorney observation, with court costs, attorney fees for the personal representative, executor's compensation, publication costs, and bond premiums where required, totaling several thousand dollars. The estate cannot pay any of those bills until the clerk authorizes the personal representative.

A Tennessee home titled in a funded revocable trust passes to the successor trustee at death without any of that. The successor trustee records a trustee's deed conveying the home to the named beneficiary, or sells the home and distributes the proceeds, on whatever timeline the trust permits and the market allows. For a Tennessee family selling the home to fund care for a surviving parent, or splitting the proceeds between adult children who all live in other states, the trust path saves months and meaningful dollars.

Why a Tennessee transfer-on-death deed is not an option

About thirty states have adopted some version of the Uniform Real Property Transfer on Death Act, which lets a homeowner name a beneficiary on the deed itself and pass the home outside probate. Tennessee has not adopted the URPTODA as of 2026. A Tennessee homeowner who wants to pass the home outside probate has two real tools: joint title with right of survivorship, and a revocable living trust. Joint title works for a married couple holding by tenancy by the entirety, but it creates a different set of problems when a parent deeds the home to an adult child during life, including a loss of step-up in basis, exposure to the child's creditors, and a partial gift that complicates TennCare planning. The trust avoids each of those problems while still passing the home outside probate.

The pour-over will catch

Most Tennessee families who use a revocable trust still need a pour-over will. The pour-over will names the executor, nominates the guardian for any minor children, and directs any asset still titled in the individual's name at death into the trust. A trust without a pour-over will leaves a gap. The pour-over will is a backstop, not a substitute for funding. The right move is to fund the trust at execution and to rely on the pour-over will only for the asset the family forgot to retitle. For the full will-versus-trust comparison, see our will vs trust in Tennessee article.

Can a nursing home take your house if it's in a trust?

A nursing home cannot directly take a Tennessee home. The risk most Tennessee families are actually asking about is TennCare estate recovery, governed by Tenn. Code §71-5-116 and 42 USC §1396p(b), which reaches the probate estate of a deceased TennCare recipient after long-term care benefits have been paid. Whether the trust protects the home from that recovery depends on which trust holds the home and how long ago the trust was funded.

A revocable trust offers zero TennCare protection on the home

A Tennessee revocable living trust does not protect the home from TennCare. Because the grantor retains the power to revoke, TennCare treats the trust assets as the grantor's countable resources for CHOICES eligibility. The home in a revocable trust counts. The brokerage account in a revocable trust counts. The cash reserves in a revocable trust count. The same logic carries forward at death. Tennessee estate recovery under Tenn. Code §71-5-116 reaches the probate estate of the deceased recipient. Tennessee, unlike a few states, has not extended estate recovery to non-probate assets, so a home that actually passes outside probate by a properly drafted trust avoids recovery in most situations. But the more common practical reality for a Tennessee family who relied on a revocable trust is that the home was spent down to pay the nursing home before the recipient died, because the revocable trust never shielded the asset during life.

The hardest version of this conversation arrives in our office every year. A Tennessee family bought a revocable trust at an online service. They were told the trust would protect the home from a nursing home. A parent has now been admitted to long-term care. The trust does not protect the home. The clock did not start. The family has to spend down to the asset limit before TennCare pays.

A Medicaid Asset Protection Trust, five years out, does protect the home

A properly drafted Medicaid Asset Protection Trust, funded with the home more than 60 months before a TennCare CHOICES application, takes the home outside the look-back, outside the asset calculation, and outside the probate estate. The MAPT is an irrevocable trust drafted under Tenn. Code §35-15 and coordinated with Internal Revenue Code §677 and the grantor trust rules in §671 through §679. The grantor relinquishes the power to revoke, cannot serve as trustee, and cannot reach the assets. The trust is drafted to include a retained limited power of appointment under Internal Revenue Code §2038, which preserves the step-up in basis under Internal Revenue Code §1014 at the grantor's death and saves the family meaningful capital gains tax when the children later sell the home.

The five-year clock starts on the day the trust is funded with the home, not the day the trust is signed. The most common funding mistake is signing the trust and then waiting six months to record the deed. The clock does not start until the deed is recorded. For the look-back math and the worked examples, see our TennCare 5-year look-back article. For the MAPT structure itself, see Medicaid Asset Protection Trust.

TennCare estate recovery, in plain English

Tenn. Code §71-5-116 limits TennCare estate recovery to the probate estate of the deceased recipient. Tennessee has not extended estate recovery to non-probate transfers. That means assets that pass outside probate, by beneficiary designation, by joint title with right of survivorship, or through a properly funded trust, generally fall outside the reach of estate recovery in Tennessee. Tennessee also exempts recovery if there is a surviving spouse, a surviving child under 21, or a surviving child who is permanently disabled or blind. Recovery is also waived for undue hardship, applied narrowly.

The MAPT, funded outside the five-year window, sits firmly outside the probate estate and outside the reach of estate recovery. The revocable trust does not, in practice, save the home, because the home is countable during life and is usually spent down before death.

The caregiver-child exemption

For a Tennessee family who did not pre-plan, the caregiver-child exemption is often the most powerful tool that remains. When an adult child has lived in the parent's home for two years immediately before the parent's nursing home admission and has provided a documented level of care during those two years that delayed the parent's move into institutional care, the home can be transferred to that child without a TennCare disqualifying penalty. The federal authority sits at 42 CFR §435.231, and Tennessee applies it through the TennCare CHOICES rule chapter 1200-13-01. The documentation requirements are strict, and the two-year residence and the level of care have to be proved with records, not asserted in conversation. Done correctly, the caregiver-child exemption can move the most valuable asset most Tennessee families own out of the reach of TennCare entirely.

Spousal protections

When one spouse needs TennCare and the other does not, the home is typically exempt during the applicant's lifetime as long as the community spouse lives in it. The home can also be transferred to the community spouse without penalty, and recovery is waived at the institutionalized spouse's death so long as the community spouse survives. The Community Spouse Resource Allowance, updated each January, lets the community spouse keep a meaningful share of countable assets. These are statutory rules, not loopholes, and they are the cleanest tool for couples who did not pre-plan.

The best way to leave your house to your children in Tennessee

For a Tennessee family whose primary goal is passing the home to the next generation, four structures actually work, and one of them does not.

Option 1: A funded revocable living trust

The home is titled in a Tennessee revocable trust during the grantor's life. The grantor still lives in the home, still claims the homestead exemption, and still controls the property. At the grantor's death, the successor trustee delivers a trustee's deed to the named children or sells the home and distributes the proceeds. The children take the home at the step-up in basis under Internal Revenue Code §1014, because the home is includable in the grantor's gross estate under Internal Revenue Code §2038. The mortgage does not accelerate, under Garn-St Germain at 12 USC §1701j-3(d)(8). This is the cleanest structure for the typical Tennessee family.

Option 2: A Medicaid Asset Protection Trust

The home is titled in a Tennessee MAPT more than 60 months before any TennCare CHOICES application. The MAPT is drafted to include the retained limited power of appointment under Internal Revenue Code §2038, which preserves the step-up in basis under Internal Revenue Code §1014 at the grantor's death. The home is protected from TennCare during life, sits outside the look-back at application, and sits outside the probate estate at death. The grantor gives up the power to revoke and cannot reach the asset. For a Tennessee family with a real expectation of long-term care, this is the right structure.

Option 3: A retained life estate deed

A Tennessee parent can deed the home to the children with a retained life estate, keeping the right to live in the home for life and passing the remainder interest to the children. The deed is cheaper than the trust. The children take the step-up in basis at death because the parent retained an interest under §2036. The strategy has two problems for many families. The deed is a transfer for TennCare look-back purposes, so the parent has to survive five years from the deed date for the home to escape the look-back. And the children's creditors and divorces during the parent's life can reach the remainder interest, which is rarely what the family wants. The retained life estate deed is a real tool for a narrow set of families, often where a trust is not feasible. It is not a substitute for a properly drafted MAPT in most cases.

Option 4: A pour-over will with a devise of the home

A Tennessee will can devise the home to the children. The home runs through Tennessee probate. The children take the step-up in basis at death. The administration costs and timing are the trade, along with the public-record exposure. For a Tennessee family that does not value privacy and is not concerned about the time on market, the will-only path works, and the trust may not be worth the higher upfront cost. For most families with a home as the largest asset, the trust does more work for the money over a lifetime.

The structure we do not recommend: outright deeding to children during life

A Tennessee parent who deeds the home outright to the children during life makes a completed gift, loses the step-up in basis at death under Internal Revenue Code §1014, creates exposure to the children's creditors and divorces during the parent's life, and triggers a TennCare disqualifying transfer if a CHOICES application is filed within five years. The children take the home at the parent's original cost basis rather than at fair market value at death, which often costs the family six figures of capital gains tax when the home is later sold. We do not recommend the outright deed to children except in the narrow case where the parent is gifting a home with a basis at or near fair market value and is not within five years of any reasonable expectation of long-term care.

Joint title with an adult child is the most common mistake

Adding an adult child to the deed as a joint tenant with right of survivorship looks intuitive. It is one of the most expensive misreads of the rules in Tennessee. The transfer is a partial gift of the fair market value of the share added, which exceeds the $19,000 per recipient per IRS Rev. Proc. on any modern Tennessee home and requires a federal gift tax return. The child's creditors and divorces can reach the share during the parent's life. The child's share at death takes the parent's original basis, not the step-up, so the child loses a substantial capital gains advantage when the home is later sold. And the partial transfer is a TennCare disqualifying transfer for the value of the share gifted to the child. The trust path avoids each of those problems.

The stepped-up basis math, in plain numbers

The capital gains math drives the structure. Consider a Tennessee home purchased for $150,000 in 1998, worth $500,000 at the parent's death in 2026. If the parent deeds the home to the children outright during life, the children take the parent's original basis of $150,000. If they sell the home at $500,000 the year after the parent's death, the gain is $350,000, and federal capital gains tax on the gain runs at 15 or 20 percent depending on income, plus the 3.8 percent net investment income tax in many cases. The children pay between $52,500 and $84,000 in federal capital gains tax on the sale.

If the parent holds the home in a properly drafted revocable trust or MAPT (with the retained limited power of appointment) until death, the children take the home at the step-up in basis of $500,000 under Internal Revenue Code §1014. The sale at $500,000 produces zero gain and zero federal capital gains tax. The trust path saves the family roughly $52,500 to $84,000 on this single transaction. The math is the same for any appreciated Tennessee home, and it is why the trust path almost always beats the lifetime gift path.

How to put your TN home in a trust, the six steps

The mechanics are predictable once the trust is drafted. The discipline is in completing every step, in order, and not assuming the trust does anything before the deed is recorded.

Step 1: Execute the trust document

The Tennessee revocable living trust or MAPT is drafted by counsel and signed by the grantor before a Tennessee notary. Most Tennessee trusts are signed at the same execution meeting as the pour-over will, the financial power of attorney, the healthcare power of attorney, the advance directive, and the HIPAA release. The trust takes effect when it is signed, but it controls nothing until the home and the other assets are funded.

Step 2: Prepare a Tennessee deed conveying the home to the trustee

A Tennessee warranty deed or quitclaim deed is drafted from the grantor in the individual capacity to the grantor as trustee of the trust, identifying the trust by name and date. The deed includes the legal description of the property, the parcel identification number, the names of the grantor and trustee, and the standard Tennessee deed acknowledgment under Tenn. Code §66-5-103. The warranty deed carries warranty covenants forward into the trust; the quitclaim deed does not. We typically use a warranty deed unless title issues counsel otherwise.

Step 3: Sign the deed before a Tennessee notary

The grantor signs the deed in front of a Tennessee notary, and the notary completes the standard acknowledgment block. Remote online notarization is permitted in Tennessee under the Tennessee Remote Online Notarization rules, which lets us complete the signing without in-person travel for clients in middle and east Tennessee.

Step 4: Record the deed at the county register of deeds

The signed and notarized deed is filed at the register of deeds for the county where the property sits, under Tenn. Code §66-24-101. The Tennessee recording fee is typically $5 to $15 per page per Tenn. Code §66-24-101 and county fee schedules, plus any required state transfer tax. Under Tenn. Code §67-4-409, transfers to a revocable trust where the grantor is also the trustee are generally exempt from Tennessee real estate transfer tax; confirm current statutory text and county practice before relying on the exemption. The recording is the moment the trust controls the home. The five-year MAPT clock, for an irrevocable MAPT, starts the day the deed is recorded, not the day the trust is signed.

Step 5: Notify the mortgage lender

A short letter goes to the loan servicer with a copy of the recorded deed and a copy of the trust certificate. The letter cites Garn-St Germain at 12 USC §1701j-3(d)(8) and confirms that the transfer is into a revocable inter vivos trust where the borrower remains a beneficiary and occupant. Most servicers update their records without a fight. A few request additional paperwork, including a copy of the trust agreement or a trust certification, and we provide those.

Step 6: Update the homeowners insurance

The homeowners insurance policy is endorsed to add the trustee as an additional named insured. The carrier issues an endorsement, often at no charge, and the policy continues without interruption. Failing to update the insurance can complicate a claim later, particularly in the unusual case of a total loss, so the endorsement is part of the funding work, not an optional extra.

How much does it cost to get a living trust in Tennessee?

The cost of putting your house in a trust in Tennessee depends on the type of trust, the complexity of the family situation, and the attorney's fee schedule.

Tennessee revocable trust package

A Lancaster Law attorney-drafted Tennessee revocable living trust package, including the trust agreement, the pour-over will, the financial power of attorney, the healthcare power of attorney, the advance directive, the HIPAA release, the funding instructions, and the initial deed transferring the Tennessee home into the trust, runs approximately $1,500 to $3,500 depending on complexity per Lancaster Law fee schedule and third-party Tennessee market reporting; confirm against current fee schedule. Online services advertise lower prices, but the price quoted rarely includes the Tennessee-specific deed work, the lender notification, or the funding integration with Tennessee statutes, and the result is the unfunded-trust failure we describe later in this article.

Tennessee Medicaid Asset Protection Trust

A Lancaster Law attorney-drafted Tennessee Medicaid Asset Protection Trust, drafted under Tenn. Code §35-15 and Internal Revenue Code §677, including the trust agreement, the coordinated pour-over will, the powers of attorney, the funding instructions, the home deed transfer, and the tax-analysis memo describing the retained limited power of appointment under §2038, runs approximately $3,000 to $7,500 depending on complexity per Lancaster Law fee schedule and third-party Tennessee market reporting; confirm against current fee schedule. The MAPT costs more than the revocable trust because the drafting is more technical, the tax memo requires CPA review, and the funding includes specific covenants the irrevocable trustee must follow.

Recording fees and transfer tax treatment

Tennessee recording fees at the county register of deeds run approximately $5 to $15 per page per Tenn. Code §66-24-101 and county fee schedules. transfers to a revocable trust where the grantor is also the trustee are generally exempt from Tennessee real estate transfer tax under Tenn. Code §67-4-409; confirm current statutory text and county practice. Transfers to an irrevocable MAPT may be subject to the standard Tennessee transfer tax under §67-4-409, depending on the structure, and the tax is calculated on the consideration or fair market value as the statute specifies. We confirm the tax treatment with the register of deeds before the deed is recorded.

Title work and lender notification

Title insurance endorsements continuing existing coverage after the transfer into a revocable trust run typically $50 to $150, depending on the carrier and the policy amount. Lender notification carries no fee. The county register of deeds records the deed at the page-based recording fee above.

The math on the lifetime cost

The cost number that actually matters is the lifetime cost of the plan, including the cost of administering the home at death. A Tennessee probate of a home in the deceased's individual name costs the estate several thousand dollars in clerk fees, publication, attorney fees for the personal representative, and bond premiums, over a 9 to 14 month uncontested timeline. A funded revocable trust administration delivers the home to the beneficiary in weeks at a fraction of the cost. For most Tennessee families with a home, the lifetime cost of the trust plan is lower than the lifetime cost of the will-only plan once the probate of the home is factored in. For the deeper trust-versus-will math, see our will vs trust in Tennessee article, and for the trust-disadvantages walk-through see disadvantages of a revocable living trust.

Common mistakes Lancaster Law sees with Tennessee home transfers to trusts

The work the family does after the trust is signed determines whether the trust does its job. Five mistakes account for almost every Tennessee home-in-trust failure we see.

Recording the deed in the wrong county

The deed has to be recorded in the county where the property sits, not the county where the grantor lives. A Tennessee home in Williamson County recorded in Davidson County is unrecorded as to the property. The trust does not control the home until the deed is recorded in the right county. Title companies catch this at a later refinance or sale, often years after the family signed the trust.

Using a quitclaim deed that breaks the title insurance

Some Tennessee title insurers will not continue existing title coverage after a quitclaim transfer, even into a revocable trust. The cleaner record is a warranty deed with the title insurance endorsement at the same time. A quitclaim deed is the right tool for a few narrow situations, and it is the wrong default for a home with an existing title policy the family wants to keep.

Skipping the mortgage lender notification

Garn-St Germain protects the loan from acceleration, but the lender's records still show the original individual borrower as the owner. When the lender pulls the property record at a refinance or a payoff and sees a trust on title, the loan officer often pauses the file and asks for paperwork. The fix takes a week if the family is patient. The fix takes a month if the refinance is on a closing clock. The lender notification at the time of the transfer prevents the surprise.

Failing to update the homeowners insurance

A claim on a policy that names the individual owner, after the home has been deeded to the trust, can be denied or delayed depending on the carrier and the loss. The fix is the endorsement at the time of the transfer. The carrier rarely charges for it. The discipline is to make the call before the claim.

Transferring the home to a revocable trust expecting Medicaid protection

This is the single most expensive mistake. A revocable trust does not protect the home from TennCare. The family who transferred the home to a revocable trust expecting Medicaid protection is in the same place at the nursing home door as the family who never used a trust at all. The fix, when there is time, is a MAPT funded more than 60 months before application. The fix, when there is no time, is one of the crisis-planning tools we describe in our TennCare 5-year look-back article and our TennCare income and asset limits walk-through.

Frequently asked questions about putting your house in a trust in Tennessee

Can I put my house in a trust in Tennessee? Yes. Tennessee law permits a homeowner to transfer the home into a revocable or irrevocable trust under the Tennessee Uniform Trust Code at Tenn. Code §35-15 by executing and recording a deed under Tenn. Code §66-5-103 and §66-24-101. The mortgage does not accelerate, under the Garn-St Germain Depository Institutions Act at 12 USC §1701j-3(d)(8), when the home moves into a revocable trust where the borrower remains a beneficiary and occupant.

Is it a good idea to put your house in a revocable trust? For most Tennessee families with the home as the largest asset, a blended family, out-of-state real estate, a reasonable expectation of incapacity, or a meaningful concern about privacy, yes. For a married couple already holding by tenancy by the entirety with no out-of-state property and a single straightforward heir, the trust often does not pay for itself during the entireties period.

Should you put your house in a will or a trust in Tennessee? For most Tennessee homeowners, the trust is the better tool. Tennessee has not adopted the Uniform Real Property Transfer on Death Act, so the trust and joint title with a spouse are the two real ways to pass a Tennessee home outside probate. The Garn-St Germain Act protects the existing mortgage when the home moves into a revocable inter vivos trust.

Can a nursing home take your house if it's in a trust? A revocable trust does not protect a Tennessee home from TennCare. The home in a revocable trust remains a countable resource for CHOICES eligibility and is reachable for estate recovery under Tenn. Code §71-5-116 to the extent the home passes through probate. A properly drafted Medicaid Asset Protection Trust, funded more than 60 months before a TennCare CHOICES application, does protect the home, because the home sits outside the look-back, outside the asset calculation, and outside the probate estate.

What is the best way to leave your house to your children in Tennessee? A funded revocable trust for most families. A Medicaid Asset Protection Trust for families with a real expectation of long-term care. A retained life estate deed in narrow cases. We do not recommend deeding the home outright to children during the parent's life, because the outright deed triggers a loss of step-up in basis under Internal Revenue Code §1014, exposure to the children's creditors and divorces, and a TennCare disqualifying transfer if a CHOICES application is filed within five years.

How much does it cost to get a living trust in Tennessee? A Lancaster Law revocable trust package runs approximately $1,500 to $3,500. A Lancaster Law Medicaid Asset Protection Trust runs approximately $3,000 to $7,500. Tennessee recording fees at the county register of deeds run approximately $5 to $15 per page. Transfers to a revocable trust where the grantor is also the trustee are generally exempt from Tennessee real estate transfer tax under Tenn. Code §67-4-409.

Does putting my house in a trust trigger the due-on-sale clause? No, for an owner-occupied home transferred into a revocable inter vivos trust. The Garn-St Germain Depository Institutions Act §341(d)(8), codified at 12 USC §1701j-3(d)(8), exempts the transfer from any due-on-sale acceleration where the borrower is and remains a beneficiary of the trust and the transfer does not relate to a transfer of rights of occupancy. The federal protection is statutory, and most loan servicers acknowledge it without dispute.

Does putting my house in a trust affect my homestead exemption? No, for a revocable trust where the grantor remains the beneficial owner and occupant. The Tennessee homestead exemption is preserved. The principal-residence treatment for federal income tax under Internal Revenue Code §121 is also preserved, because every revocable trust is a grantor trust under §671 through §679.

Does the trust protect the home from my creditors during my life? No, for a revocable trust. Tenn. Code §35-15-505 treats the assets of a revocable trust as the grantor's resources for creditor purposes, because the grantor retained the power to revoke. A Tennessee family that wants self-settled asset protection has to use an irrevocable structure, such as the Tennessee Domestic Asset Protection Trust under the Tennessee Investment Services Act at Tenn. Code §35-16, or a MAPT for the Medicaid context.

Can I sell my house if it's in a trust? Yes, in the typical case. For a revocable trust where the grantor is the trustee, the grantor signs the listing agreement and the closing documents as trustee, and the sale proceeds belong to the trust. For an irrevocable MAPT, the trustee follows the trust agreement and may need to coordinate with the beneficiaries, depending on the drafting. Tennessee title companies are comfortable with both structures when the trust certificate is provided.

How long does it take to put my house in a Tennessee trust? The trust is drafted in a week or two. The deed is prepared, signed, and recorded in a few days after execution. The lender notification and insurance endorsement add another week. The whole process is typically complete within thirty days of the first meeting. For a MAPT, the five-year TennCare clock starts the day the deed is recorded, not the day the meeting begins.

What is the seven-year rule for trusts? The seven-year rule is United Kingdom inheritance tax law and has no analogue in United States federal estate or gift tax law. The closest United States rule is the five-year TennCare look-back applied by Tennessee Medicaid for long-term care eligibility. A Tennessee family searching the term has almost certainly stumbled across UK content that does not apply.

Why the Tennessee home-in-trust question rewards a fifteen-minute conversation

The decision to put your house in a Tennessee trust has a right answer for every Tennessee family, and the right answer is rarely the answer the online services try to sell. We see families who were sold a revocable trust they did not need, and we see families who relied on joint title with a child when a properly drafted MAPT would have preserved the home and the step-up in basis. The fifteen-minute version of the conversation usually settles it. Bring the address of the home, the deed if you have it, the mortgage statement, the names of the heirs, and the rough picture of long-term care risk in the family. We walk through the structures above against your facts and recommend the cleanest one for the situation. If the answer is a revocable trust, we draft and fund it the day we draft it. If the answer is a MAPT, we walk through the five-year math and the drafting choices. If the answer is no trust at all, we say so.

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