Does a Revocable Living Trust Protect your Assets?

Suppose that you plan to get re-married, and in order to keep your assets separate from your significant other you set up a revocable living trust, naming yourself as trustee and sole beneficiary.  Three years later, a neighbor trips on your door step, breaks his leg, and wins a lawsuit against you.  Can the neighbor collect the lawsuit judgment by filing a lien on your home, even though the home is held by your trust?

Generally speaking, yes, a judgment creditor can reach the assets of the trust during your lifetime.  Oklahoma law does not allow debtors to escape their creditors by simply moving their assets into a trust that may be revoked at any time.

However, The Oklahoma Family Wealth Preservation Trust Act allows you protect up to $1,000,000 if certain steps are taken, such as 1) naming a co-trustee, and 2) investing the majority of the trust’s assets in Oklahoma assets, like Oklahoma property or stocks and bonds from an Oklahoma-based company.

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On August 27, 2013, Gary Quinnett presented a legal seminar on commercial real estate issues. The attendees rated him "Excellent"