How to Protect Real Estate Equity

How to Protect Real Estate Equity

If you have equity in your property, you’re at risk. The reality of the situation is that equity is what people are looking for whenever they wanna sue you. There’s a couple of different ways that you can protect yourself against this. One is that you could actually take out a true mortgage on the property, going through a bank and going through that entire process and physically pulling the money out. Now that has its own drawbacks, right. I mean, you have closing costs as well as you’re having to pay interest on that money. Another option would be to actually disguise the equity. It doesn’t actually protect you if there’s a lawsuit, but it’ll make it look like the property doesn’t have any equity attached to it. You do that with a home equity line of credit. A third option is to establish your own mortgage company. And by establishing your own mortgage company, you can issue a mortgage basically to yourself In a way. Through the company structure, this allows you to be able to have a no-cost way of establishing mortgage, besides the recording fees, and attorney’s fees in setting that up. But that’s always gonna be lower than the closing cost of something you would do at the bank. And you never actually have to do much with it after that. Because it’s a true mortgage that’s recorded on the property, if there’s a lawsuit That mortgage actually has to get paid out before a creditor could collect. My name is Scott Smith, I’m an asset protection attorney with real estate, I’m a real estate investor myself and I wanna help you.

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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