For those who are new to the world of real estate, the terms “under agreement” and “under trust” may seem confusing and interchangeable. However, in the context of a real estate transaction, they have distinct meanings and implications.
“Under agreement” refers to a stage in a real estate sale where the seller has accepted an offer from a buyer, but the transaction has not yet been finalized. During this period, the property is still technically on the market, but the seller has agreed to sell to the buyer as long as certain conditions are met. These conditions may include a home inspection, appraisal, and financing approval.
Once all the conditions are satisfied, the sale moves forward to closing, and the property is considered “sold.” However, until that point, the property is still technically available to other potential buyers who may be interested in making an offer.
“Under trust,” on the other hand, refers to a legal arrangement where a trustee holds assets (including real property) on behalf of a beneficiary. This is often done as a means of estate planning or to protect assets from creditors or legal proceedings.
In the context of real estate, a property can be placed “under trust” by its owner, who transfers ownership of the property to a trustee. The trustee then manages the property and any income it generates, and the beneficiary retains the right to use the property or receive income from it.
This can be a useful strategy for families who want to ensure that a property stays within the family and is not subject to probate proceedings, or for individuals who want to protect their assets from creditors or lawsuits.
It`s important to note that the terms “under agreement” and “under trust” are not interchangeable. A property that is “under trust” is not necessarily for sale, and a property that is “under agreement” is not necessarily held in a trust.
In conclusion, understanding the difference between “under agreement” and “under trust” is important for anyone involved in real estate transactions or estate planning. While they may seem similar at first glance, they have distinct meanings and implications that can impact the success of a sale or the protection of assets for generations to come.