Trust/HELOC Issue With Wachovia

I’ve been thinking about placing my properties in a trust and decided to call Wachovia and ask them if I would be in violation of the DOT by doing so.They told me that if I placed it in a trust they would have to close out that loan and the trustee would have to apply for a new HELOC in their name,even though I’m the benefeciary.

Can someone explain to me how this is supposed to work?



You also posted this question on another forum. Here is Bill’s response to you:

Apparently you asked the wrong question, or asked the question wrong. Statements are always better than questions, and too, there’s a big difference between the due-on-sale clause and the occupancy clause.

Your query might better have gone like this.

Sir, I have a heloc on my home and am placing it into my inter vivos trust at the advice of my attorney. What do you need from me?

They will then send you a bunch of forms to complete, which are essentially for proving that you are not doing anything that you would need their approval for, or have needed to call for in the first place.

Remember that irrespective of what they might say or think, you have the absolute right to transfer your mortgaged home to an inter vivos trust wherein you are a beneficiary, wherein the trust in revocable and wherein the trust, within itself, does not transfer occupancy rights.

What your source was likely referring to is the occupancy provison of the HELOC. If the bank objects to your moving out of the property, then they have a valid argument since you are probably violating their occupany provision…not the due-on-sale provision.