What is a certificate of trust?

Making a trust can be a powerful way to protect your property and provide for your loved ones. A trust allows your assets to be easily distributed and helps your heirs avoid the time and cost of probate.

If you’ve created a trust as part of your estate plan, there may be times you have to prove its existence to third parties, confirm who has the power to manage it, or verify other important details. This is where a certificate of trust comes into play.

What is a certificate of trust?

A certificate of trust — also called a “trust certificate” or “memorandum of trust” — is a legal document that’s often used to prove (or “certify”) a trust exists and to provide information about its important terms. Your trustee can show it to third parties (like your bank) to prove they have the legal authority to act on behalf of your trust.

Think of a trust certificate like an executive summary: It highlights key information about your trust — like your trust’s name and the name of your trustees — without sharing information you want to keep private, like the specific property in the trust or your beneficiaries’ identities.

This short document can be used to verify your trust’s existence and the identity of the current trustee with banks, lenders, and other third parties who request it.

What’s the purpose of a trust certificate?

When you create a trust, all the details about the trust are written into a trust document. This includes information that you may not want to share with others, like what property the trust owns, how much that property is worth, and how the trust-owned property will be divided amongst your loved ones.

It’s true that you can simply use a copy of your entire trust document to verify the existence of your trust to third parties, but trust documents are often long, complex, and full of confidential information that you may want to keep private. A trust certificate, however, is short and to the point.

A trust certificate provides just enough information to prove a trust exists and share information about its key terms — without disclosing any sensitive information. It also verifies that the trustee has the legal authority to act on behalf of the trust (either in general or with respect to certain transactions).

What information is in a trust certificate?

Trust certificates only contain the most essential pieces of information about your trust.

Certificates of trust generally include:

• The name of the trust and the date it was created
• The trust’s taxpayer identification number
• Your name (as the grantor)
• The name of the trustee(s)
• The trustee’s powers (what they have the authority to do under the trust)
• Whether the trust is revocable or irrevocable (if revocable, you’ll also need to include who has the power to revoke the trust)

Each state has its own requirements for what you should (and shouldn’t) include in your trust documents. This means that the exact information you'll need to put in your certificate of trust might vary based on where you live. If you have questions about what information you should include in your certificate of trust, consider working with an estate planning attorney.

Do you need a certificate of trust?

You may be wondering: “I already have a trust document. Do I really need a certificate of trust?”

While it may seem repetitive to have two documents with similar information, having a certificate of trust can protect you and your interests. Here’s why:

Trust certificates are a tool you and your trustee can use to prove your trust’s legitimacy without sharing confidential details. When a bank, lender, or other financial institution asks to see your certificate of trust, they only get the information they need to know. For example, they may ask for a trust certificate to confirm who your trustee is and what powers they have. This helps them determine if (and how) the trustee is allowed to make certain transactions on behalf of the trust.

Some situations that may call for a certificate of trust include:

• When you transfer assets to your trust
• When your trust takes out a loan
• If you want to use the trust as collateral
• When the trustee needs to make financial transactions on behalf of the trust

Some states have specific statutes (or laws) about how to set up or word a trust certificate. You’ll want to make sure you understand your state’s requirements to avoid any roadblocks or delays in processing your request.

How to get a trust certificate

There are multiple ways that you can get a trust certificate. You can:

• Use a self-help resource to create a certificate of trust yourself
• Request that an estate planning attorney prepare one for you
• Get a template or form from your bank or financial institution

Your certificate of trust needs to meet your state's requirements. It should also contain details relevant to any transactions you or your trustee may need to make. For instance, if your trustee needs to make a real estate transaction, your trust certificate should outline what powers the trustee has relating to real estate. This is why it's usually wise to work with an estate planning attorney to create a certificate of trust. They can ensure all necessary legal requirements are met and help you identify other items to include.

For your certification of trust to be valid, you need to execute it. Generally, this means you and your trustee will need to sign your trust certificate in the presence of two witnesses, who also sign. Depending on the state you live in and what’s in your trust, you may also need to have it notarized or registered with your county or local court. If you buy or sell property on behalf of the trust, you might also need to record your trust certificate with your title company. This will help prove that any property or real estate in the trust has been properly transferred, so that there are no questions about ownership.

In order to get a trust certificate, you first need to create a trust. If your estate is large or complicated, an estate planning attorney can help you through this process. However, if you have a simple estate, you may want to consider taking advantage of a self-help solution to create your trust.

If you're interested in creating a trust, consider using FreeWill’s revocable living trust tool. In less than half an hour, you can have your trust documents prepared and ready to sign — all for a fraction of the cost of an attorney.