Do I need a revocable trust instead of a will if I own multiple residential and commercial properties? – North Carolina

Short Answer

Not always. In North Carolina, a will can control who inherits real estate, but it usually requires a probate estate administration through the Clerk of Superior Court to transfer title. A properly funded revocable living trust can keep the parent in control while alive and can let a successor trustee step in at incapacity or after death to manage and transfer multiple properties without relying on the probate process for trust-owned assets.

Understanding the Problem

Under North Carolina estate planning law, the decision is whether a parent who owns multiple residential and commercial properties should rely on a will (with probate administration) or use a revocable trust so the parent keeps control during life and the children can step in only upon incapacity or after death. The key issue is how property management and title transfers happen when the parent can no longer act, and whether the plan should reduce the amount of court-supervised administration needed to deal with several deeds, leases, and ongoing property expenses.

Apply the Law

In North Carolina, a will is the document that directs how probate assets pass at death, but it generally works through an estate administration opened with the Clerk of Superior Court. A revocable trust is a separate legal arrangement where the parent (as the creator and usually the initial trustee) keeps control and can amend or revoke the trust during life; if incapacity occurs or after death, a successor trustee can manage and distribute trust property under the trust terms. For real estate-heavy estates, the practical difference often comes down to (1) whether the properties are titled in the trust before death and (2) whether the plan needs built-in, private management authority for a successor decision-maker.

Key Requirements

Control while alive: With a revocable trust, the parent typically serves as trustee and keeps day-to-day control (collecting rent, signing leases, refinancing, selling) as long as capacity remains.
Funding (retitling) the properties: A trust only helps with a property if the deed (or ownership interest) is actually transferred into the trust or otherwise coordinated with the plan. A will does not require retitling during life, but it usually triggers probate at death for individually owned property.
Successor authority at incapacity and after death: A trust can name a successor trustee to step in under the trust’s incapacity standard and continue managing multiple properties without first being appointed by the court as a personal representative.

What the Statutes Say

N.C. Gen. Stat. § 31-39 (Probate necessary to pass title; recordation in county where real property lies) – Explains that a duly probated will is effective to pass title, and it highlights timing and county recordation issues for real property.
N.C. Gen. Stat. § 31-40 (What property passes by will) – Confirms that a will can devise real and personal property owned at death.

Analysis

Apply the Rule to the Facts: The parent’s goal is continued control during life with children stepping in only at incapacity or after death, and the parent owns multiple residential and commercial properties. A revocable trust can match that goal because the parent can remain trustee while capable, and a named successor trustee can take over management when the trust’s incapacity trigger is met. A will can still direct who inherits, but it typically requires a probate estate administration to transfer title and manage the properties during the administration, which can be cumbersome when there are multiple deeds, leases, and property expenses.

Process & Timing

Who sets it up: The parent. Where: Trust and will are signed as private documents; deeds are recorded with the Register of Deeds in the county where each property is located. What: A revocable trust agreement, a “pour-over” will (commonly used to direct leftover probate assets into the trust), and new deeds transferring each property into the trust (or other coordinated ownership changes). When: Before incapacity or death; the trust only avoids probate for assets actually placed into it.
If incapacity happens: The successor trustee follows the trust’s incapacity procedure (often requiring written proof such as physician statements, depending on how the trust is drafted) and then manages the properties: collecting rent, paying expenses, renewing leases, and handling repairs.
After death: The successor trustee continues managing and then distributes or retitles trust-owned properties to the beneficiaries under the trust terms. Any assets left outside the trust may still require a probate estate administration under the will.

Exceptions & Pitfalls

“Unfunded trust” problem: Creating a trust but leaving properties titled in the parent’s individual name often means probate is still needed for those properties, even if the trust exists.
Multi-county real estate administration: When properties sit in different North Carolina counties, a will-based plan can require extra steps to ensure the probated will is properly filed/recorded in each county where real estate lies, which can slow down sales or refinancing.
Business and lease coordination: Commercial properties often involve leases, security deposits, vendor contracts, and sometimes entity ownership. The plan should coordinate who has authority to sign, renew, or terminate agreements at incapacity and after death.
Still need a will: Even with a revocable trust, a will is commonly used as a backstop to name an executor and direct any probate assets into the trust, reducing the chance that something is left without clear instructions.

Conclusion

In North Carolina, owning multiple residential and commercial properties does not automatically require a revocable trust instead of a will, but a trust often fits the goal of keeping control during life and allowing a successor decision-maker to step in at incapacity or after death. A will can pass real estate, but it generally works through probate and may require additional county filing steps for properties in different counties. A practical next step is to inventory each property and confirm whether each deed should be transferred into a revocable trust now.

Talk to a Estate Planning Attorney

If you’re dealing with planning for multiple residential and commercial properties and want a plan that preserves control during life while building in a smooth transition at incapacity or death, our firm has experienced attorneys who can help you understand your options and timelines. Call us today at (919) 341-7055.

Disclaimer: This article provides general information about North Carolina law based on the single question stated above. It is not legal advice for your specific situation and does not create an attorney-client relationship. Laws, procedures, and local practice can change and may vary by county. If you have a deadline, act promptly and speak with a licensed North Carolina attorney.