Revocable trusts may be classified as trusts that are intentionally either (i) funded, or (ii) unfunded. Funded revocable trusts are popularly referred to as “living trusts” and are used to circumvent probate:
“O’s Will might be described as a document executed by him during his lifetime that will control the devolution of some or all of his property from and after his death, but that is subject to change and revocation by him as long as he lives. Such a description, however, if set forth in any one of several revocable inter vivos property arrangements that are now widely recognized as non-testamentary in character, can be carried out without subjecting the property involved to probate administration on O’s death.
The revocable inter vivos trust is one of the widely employed vehicles in the avoidance of probate. Attacks on this type of trust, as being testamentary insofar as the trust provides for the disposition of property from and after death of the settlor, have been made from time to time, but with little success.”
James Casner, Estate Planning: Avoidance of Probate, 60 Colum. L. Rev. 108, 108-09 (1960).
Maryland follows the general rule that revocable trusts are not testamentary and therefore do not need to follow the execution requirements imposed by law. Md. Code Ann., Est. & Trusts § 4-102; see also Howard v. Hobbs, 125 Md. 636, 94 A. 318 (1915) (rejecting self-forgiving mortgage as testamentary in nature); Brown v. Fidelity Trust, 126 Md. 175, 183-84, 94 A. 523 (1915) (quoting Brown v. Mercantile Trust Company, 87 Md. 397, 40 A. 256 that a deed is not of a testamentary character where “the declaration of trust [deed] sets forth that the [assets] have passed out of the possession of the grantor…the transaction, therefore, was complete, and all present interest has become vested in the trustee.”).