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GLOSSARY

Canadian Financial, Real Estate and Mortgage Glossary

How often this word is used
 
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Trust


Synonyms:account, funds, grant, money, will
Filed Under: estate-management, financial-banking
Tags: banking, legal
 

Definition of trust

trust
1. A trust is a fund that is set up similar to a will. The trust specifies how money or property will be disbursed, it lists the recipients or beneficiaries, and names one or more trustees to manage the assets. An irrevocable trust cannot be changed after the terms are finalized; a revocable trust has more room for how much can be transferred, but it is usually more expensive to maintain.

Related Terms and Acronyms:

  • fiduciary duty   A requirement that someone in a position of trust, such as a banker, real-estate agent, or title agent, must act in good faith and trust on behalf of a client.
  • life insurance trust (LIT)   A legal entity that is made the beneficiary of a life insurance policy, often arranged to evade taxation.
  • reconveyance   The transfer of title to the borrower after a mortgage has been paid fully.
  • Registered Education Savings Plan (RESP)   An investment vehicle used for a child's post-secondary education.
      ➥  RESPs are offered by most financial institutions in Canada.
  • revocable beneficiary   A beneficiary whose benefit can be modified without his or her consent.
  • sprinkling provision   A provision that gives a trustee the authority to distribute life insurance death benefits as he or she sees fit, and to those who need the money the most.
  • survivorship   The right of a person to secure ownership by reason of his/her outliving someone with whom s/he shared undivided interest in the land.
  • trust account   An account used by a law firm or real estate agent to handle earnest money, funds set aside for repairs and other money that the buyer and seller put up before closing.
  • trust company   A company that acts as a trustee (an entity that controls financial assets on the behalf of another).
  • trustee   A person who holds and manages assets for the benefit of beneficiaries.

More Related Terms and Acronyms

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