Hey Moguls, Mr. Land Trust Randy Hughes is here today with an awesome lesson about, well, you can probably guess… Land Trusts. He’s our #1 expert on this sometimes confusing topic, and we trust him to give us the info we need on a level that we can understand. And he sure does delivers.
If you missed his killer series, start with Part 1.
And he recently did a terrific lesson about seller financing and land trusts.
But, back to today… take it away, Randy…
From Mr. Land Trust, Randy Hughes
I have been using Land Trusts for over 35 years, but every now and then someone will challenge me as to the purpose and "honesty" in using a land trust to hold title to real estate investments.
So, let's clear the air, shall we?
Recently, I was talking to a real estate investment club owner about speaking to his club regarding land trusts. He said, "We do not believe in using Land Trusts because they are dishonest." He then went on to explain how someone had come to his club to speak about land trusts and that led him to believe that the use of a land trust was a deceptive practice and takes advantage of people.
Whoa!
I told him that I was sorry that he had been misinformed about land trusts, and that he should reconsider their use and benefits. I went on to review with the club owner why it is important to NOT have your name in the public records as owner of real property…
10 Reasons Why You Want Your Name Kept Private
1. A group of investors may be purchasing several properties for a special purpose, and it may be that the desired result can be best accomplished if the objective is not made public.
2. Co-owners might desire that the interest of each beneficiary must be kept private.
3. An individual owner might not want to be hassled with inquiries regarding the property.
4. A real estate investor might not want his competitors to copy his acquisition techniques.
5. Real estate investors do not want their tenants to know they are the “owner” of the property (helps with day-to-day management and lease renewal negotiations).
6. Co-owners want to know that a lien or judgment or divorce of one owner will not affect the title to the property.
7. Out-of-state owners can avoid probate and other legal issues upon death, for a smooth transition of succession.
8. A group of heirs can inherit a property held in a land trust with ease of management (by the director) and no need for a partnership agreement and a partnership tax return.
9. Co-operative housing corporations may elect to hold title to their land and buildings in a land trust. They could then issue a beneficial share to their residents in place of stock certificates - simplifying control and record keeping.
10. When a Trustee of a Land Trust signs the mortgage (that gets recorded in the county court house records), the debt will not show on the borrower's credit report.
Here’s the Bottom Line
Land Trusts have been used by American citizens for over 100 years for good reasons.
There are many legitimate reasons to use a Land Trust for privacy and asset protection. No one will protect your assets like YOU will. Learn all you can now because "old and cold" matters. Ever since 9/11, it’s been getting harder every year to be private and protect your assets.
Do it now, don't delay!
Talk to Me
Got any land trust questions? Leave ‘em in the comments section below.
Understand that Land Trusts have good, honest benefits.
Know that Land Trusts are great for keeping information private.
Consider the various reasons why land trusts are awesome and maybe try using one for your next deal.
Randy Hughes
bought his first single family home for rental while in college in 1969 and hasnít looked back since. Heís since purchased over 200 houses, and has developed a special expertise focused on how to protect your assets and how to become more private with your personal life through the creative, 100% legal and ethical use of Land Trusts. On the topic, Randy has written extensively for national real estate publications, has published a number of Privacy and Asset Protection books including Land Trusts Made Simple, and has been a licensed Continuing Ed Instructor for the Illinois Assoc. of Realtors for 20+ years. He even teaches land trust law and administration to attorneys.