Understanding Trusts

Property is sometimes held in a trust rather than in an individual's name. Buying from a trust or buying in the name of a trust has specific rules you should understand.

What is a Trust?

A trust is a legal arrangement where assets (like a property) are held by trustees for the benefit of beneficiaries. The trustees manage the trust according to the trust deed. In South Africa, family trusts are often used for estate planning and asset protection.

Buying a Property Held in a Trust

• Seller is the trust: The trustees act on behalf of the trust. All trustees who must sign (per the trust deed) must agree to the sale.
• Resolution: Banks and conveyancers will require a trustee resolution authorising the sale of the property.
• Transfer: The transfer attorney will need the trust deed, letters of authority, and proof that the signatories are authorised trustees.

Getting a Bond When the Buyer is a Trust

If you are buying in the name of a trust, banks treat it as a different type of applicant. They will require the trust deed, trustee resolutions, and often personal suretyship from the trustees. Interest rates and terms can differ from a normal personal bond. Not all banks lend to trusts—your bond originator can advise.