Legal Question in Wills and Trusts in Utah
Disabled childs trust investments
My sons trustee has been directed as to how investments are to be made. His trust basically says they can invest in anything EXCEPT real estate, or interests of participation therein (including common trust funds maintained by the trustee)
My question is they have been investing in Fannie Mae, Freddie Mac, and mortgage companies, does this seem to be allowed under the terms of his trust agreement? As I have read it as they shall not invest in anything that has anything to do with real estate. Thank You.
2 Answers from Attorneys
Re: Disabled childs trust investments
I am unable to respond to your question without reading the exact words in the trust. It is unusual to prevent investment in real estate. If such is the case, it is probable that the trustee cannot buy real estate or be an owner listed on the deed. You must pay particular attention to the exact wording. It is possible to invest indirectly and not violate the provisions of the trust.
Re: Disabled childs trust investments
I have no knowledge of the trust agreement provisions, so I cannot comment. A security, which is collateralized by real estate, is not an investment in real estate. A prudent trustee may be allowed to invest in the shares of a company that owns, manages or develops real estate, for example.
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