Anonymous Land Trust for Real Estate Investors
Royal Legal Solutions is one of the only firms in the country who regularly offers and manages land trusts
The Anonymous Land Trust is a lesser-known but highly effective tool for protecting your anonymity when you invest in real estate. The benefit of anonymous ownership is that it can stop a lawsuit from happening in the first place. Learn how the land trust works and hides your properties from prying eyes, helping eliminate the threat of lawsuits.
What are the parts of a Land Trust?
A Anonymous land trust has three parts: a grantor, a trustee, and a beneficiary. Anonymous Land Trusts, also known as Title Holding Trusts, are a little-known legal tool that offer smart investors a way to hold property anonymously.
How does a Land Trust work?
When you choose to form a land trust with Royal Legal Solutions, we will serve as your trustee. You will become the designated beneficiary. This allows you to reap the rewards of property ownership, such as investment income, without being publicly identified as the owner. The trustee’s role is to manage the trust itself.
What does the process involve?
The anonymous land trust designates Royal Legal Solutions as the “nominee trustee.” After the filing process is complete, our firm will resign its role as trustee, designating you to be the sole trustee. Provisions for this action will be spelled out in the Trust Agreement. This means Royal Legal Solutions will never actually control the property, but will simply act as the trustee of record. If and when you sell the property, you will need to produce the Trust Agreement. This document designates you as the trustee and you alone will have the power to approve the sale.
Contact us for a consultation on Anonymous Land Trusts in your asset protection plan.
How Do Land Trusts Prevent Lawsuits for Real Estate Investors?
Understanding how land trusts prevent lawsuits requires some understanding of the “business” side of litigation.
For someone to sue you, they have to get a lawyer. The lawsuit process begins with that lawyer researching you. The reason for this is simple: they would like to get paid. For a lawsuit to be a profitable endeavor for an attorney, you must have assets that a court can seize and liquidate into cash. Properties held in your name are a great example.
When you use a land trust, however, it owns the asset, not you. You personally no longer have your name associated with the property at all. Suing the trust itself is extremely difficult as well. Because of the anonymous nature of the land trust, even an excellent attorney will have a difficult time definitively connecting you to your land trust. You have now become more trouble than you are worth to the opposing lawyer. There is no certainty of any financial reward for either the litigant or the attorney after your assets, and therefore, land trusts often help effectively stop lawsuits before they are even filed.
Why Choose Royal Legal Solutions
for Your Real Estate Land Trust?
Royal Legal Solutions offers the land trust at a lower cost than competitors. We are also proud to be one of the only firms in the country who regularly offers and manages land trusts. Further, with us serving as your trustee, you don’t have to worry about mismanagement of your valuable real estate asset or trustee fraud. Technically, anyone can be your trustee, but when you choose an experienced attorney as a trustee, you can rest assured knowing that we know what we are doing and took an oath to serve your best interests at all times. We have been dealing with land trusts professionally for years. If you have an existing LLC, or ideally Series LLC structure, we can assist you with incorporating your new land trust into this structure for the most effective asset protection plan possible.
Don’t wait until a lawsuit is filed against you. Be proactive: contact us about forming your land trust today.
What Are Some of the Benefits of Using a Land Trust With Investments?
The lawsuit prevention methods mentioned above combine with the land trust’s anonymity and versatility to secure your real estate investments. On its own, the land trust is not a surefire asset protection plan. However, when combined with an entity like a Series LLC, the land trust proves to be a powerful tool in the asset protection arsenal.
Protection from Identity Thieves
If someone is looking to steal your identity, they are really looking for your information. Public records of things like your real estate purchases, mortgage payments, and other investment information are a veritable treasure trove for the identity thief. Land trusts keep your name off of public records, making you a much harder target for would-be identity thieves. Fortunately for the smart investors who use land trusts, most criminals will move on to lower hanging fruit.
Perhaps you signed a mortgage or other type of loan for your investment property. Most loans contain a clause known as the “due on sale” clause. This means that you cannot sell the property without being forced to pay back the financing in full. This can create an issue when you choose to transfer your property into an LLC. Since most financial institutions do not like to lend directly to LLCs, clients who use them for asset protection can find themselves in a frustrating situation. The good news is that a land trust can essentially solve this problem. You simply buy the property in your own name, which allows you to access any line of credit or loan you are personally eligible for, then transfer the property into the land trust. Your land trust owned property can then be placed inside of your Series LLC or other corporate structure.
Multiple Ways to Hold Ownership
When you use a land trust, you have more options for exactly how you own property. In states that permit Tenancy-By-The-Entireties, married couples can own interests in a property in this manner with a land trust. Some couples use this to prevent a lawsuit against one spouse from affecting the other. It also can be beneficial in the event of a divorce in a community property state. Assets held in trusts have specific documents governing their sale and division. Learn more from our free resource about the benefits of tenancy by the entireties.
Why Use Royal Legal Solutions
for a Real Estate Investment Asset Protection?
We have experience in setting up the proper asset protection and making it easy for an investor to use. Our system simplifies management structure as much as possible, and we also use common sense to ensure your needs are met. For example, just one tip we give our clients is that you don’t need multiple bank accounts as long as you have accurate accounting records. For taxation, they should stay exactly how they are now while being reported on a Schedule E of your personal return (if you’re an individual/married partners) or a partnership return (if unmarried partners).
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An estate plan is a legal strategy that addresses how your money and other assets will be distributed upon your death.