Should My Land Trust Have A Private Trustee or Institutional Trustee?

Although choosing a trustee for your land trust is an important thing you have to do for your property or assets, it is also a hard decision to make. Should you choose a private trustee or a banker or other institution?

Although it may seem like an easy task, it isn't. Let's look at how you can choose to search for a private trustee or an institutional one.

Pros and Cons of Choosing a Private Trustee

There are many advantages and disadvantages of choosing a private or individual trustee for your land trust. Keep reading to learn more.

Pros Of Choosing a Private Trustee:


  • Cheaper than an institutional trustee
  • May serve as your private trustee for free
  • Have more knowledge about you and your property or assets
  • Will only work for the beneficiary and not for more than one client
  • Has an interest in the beneficiary's well being
  • Knows your needs and desires

Cons Of Choosing a Private Trustee:


  • May not know enough information about the trust records
  • Might need professional help even with a private trustee
  • Does not have enough experience in making decisions for investments or distribution
  • Is not experienced enough in managing the trust
  • Can be easily influenced and may fight with family or friends
  • May cause problems with taxes and may undermine creditors

Pros and Cons Of Choosing an Institutional Trustee

Pros Of Choosing an Institutional Trustee:


  • Is more experienced in investments, trusts, record keeping, and the laws for trusts.
  • Is unbiased since not related to the property owner.
  • Is knowledgeable in decision making for the trust.

Cons Of Choosing an Institutional Trustee:


  • More expensive than a friend or family member
  • Is not available at any time, like a private trustee may be
  • May not understand your needs for the trust like a friend or family member would


Thinking about each pro and con for private trustee and institutional trustee and weighing them will help you make a final decision for your preferred trustee. Take your time and really weigh them together. Although it seems that an institutional trustee may be the best decision, it is important to consider each advantage and disadvantage of both types.

Choosing the right one for your trust is the first and most important step in forming the trust for your property or assets. After choosing the right one, you can then move on to the next steps in forming the trust for your most important assets and property.

Last Updated: 
April 8, 2018

Scott Royal Smith is an asset protection attorney and long-time real estate investor. He's on a mission to help fellow investors free their time, protect their assets, and create lasting wealth.

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