Posted by JAM/CA on 11/15/12 5:38pm
Msg #443536

Minors on RTC and TIL

New one on me in 9 years. Closing a loan in Trust, two minor children are
beneficiaries on Trust.

The lender wants the minor children to sign the RTC and TIL. However; the parents will sign for the minors as: Joe A. Doe (child) by Parent, John R. Doe as Father.

My curiosity is not for completing the signing, I know how to do it. But, what possible reason would
they have for this? Escrow has never seen it and they don't know why either.

Could the children actually cancel the loan???????

Reply by Linda_H/FL on 11/15/12 5:47pm
Msg #443539

If the children are merely beneficiaries I don't see

how they have any ownership interest in the property at all - the trust does, but they don't -

Suppose the beneficiaries were all the children and ALL the grandchildren..good grief!

Sounds liek someone at title doesn't understand Trust Agreements.

Reply by Linda_H/FL on 11/15/12 5:48pm
Msg #443541

errr...that would be LIKE

Also, can minors sign binding documents like that in CA? Make sure the parents signing for them is okay with title.

SMH

Reply by JAM/CA on 11/15/12 5:57pm
Msg #443543

Exactly Linda. ??? n/m

Reply by Gregory/CA on 11/15/12 5:48pm
Msg #443540

That is a strange request, especially since the children are beneficiaries. In general, a minor can enter into a contract. However, most contracts cannot be enforced against minors. (They are voidable, at the request of the minor.) For that reason, most people are hesitant to enter into a contract with a minor. However, the minor can enter a contract, can choose not to void it, and can enforce it against the other party.

I wonder why the lender wants them to sign. Very strange to me.

Just my two cents.

Reply by Edward Cooke on 11/15/12 6:21pm
Msg #443549

Very odd

I think that's a very odd request considering that the beneficiaries do not hold legal title to any property in the trust. That is vested in the trustee.

Reply by parkerc/ME on 11/15/12 9:16pm
Msg #443573

Sounds like the Trustee should be signing.

Reply by JanetK_CA on 11/16/12 2:08am
Msg #443584

I agree with you and Edward. Nearly all the Trust Certification forms I've seen completed ask who has authority to make decisions on behalf of the trust and it's virtually always the trustees. They don't usually even ask who the beneficiaries are. I'm no attorney, but I've always thought that the beneficiaries have nothing to day about the trust until they become successor trustees by the death of (usually) both parents.

Very weird, indeed! But as the saying goes, "ours is not to reason why..."

Reply by dgd/CA on 11/16/12 8:33am
Msg #443597

Sounds as though the lenders underwriter and/or doc drawer has no idea what she/he is doing.

Reply by ArtG/KS on 11/16/12 10:30am
Msg #443609

The minors are not required to sign anything as they do not possess the property and are not on title until they either turn 21 (2053-C) trust or when trustee dies as is in a testamentary trust. There are tax implications to these too and must be examined preferrably by a good tax attorney. If the children are incapacitated adults, then the trustee should have POA or conservatorship. For a real answer to this, its an attorney's researched legal opinion only that I would use.

Reply by JAM/CA on 11/17/12 9:18pm
Msg #443847

Yes, Trustees signed all docs and RTC.

Along with children. Makes no sense.

Reply by Jessica Ward on 11/16/12 10:58am
Msg #443624

Surely the minors are not trustees in the trust

So why in the heavens would they sign? I've done lots of trust closings and have never seen anything like this.

I've always seen it set up so that the trustee signs on behalf of all beneficiaries of the trust.

It's like having all employees sign off on a document requiring a corporate seal. The seal by the corporate officer does the trick.