LAND TRUSTS

     Do you own real estate in your own name? If so, you could become the target of lawsuits by tenants, creditors, or others. Since anyone can go down to the county courthouse or recorder's office and look up the owner of any property, your most valuable assets may be exposed to public scrutiny. Real estate records are now computerized, so all of your real estate holdings can be located with a simple key stroke. If you own real property, particularly rental or investment property, you may want to consider using a Land Trust.

What is a Land Trust? A Land Trust is a special device established to hold the ownership interest of real property. The property is deeded to the trust which names a trustee who appears on the public record but the true owner remains anonymous.

Why use a Land Trust? There are many advantages to holding property in a Land Trust. Some of the benefits include privacy, control, ease of transfer, avoidance of lawsuits, liens, and probate.

Privacy. The Land Trust is a device which offers numerous benefits to you as a property owner. One of most important benefits of the land trust is privacy. By using a land trust with an independent trustee there will be no public record of your ownership of the real estate in the trust.

Control. The beneficiary of your trust can be you individually, a corporation, a partnership or any other legal entity. If you are the beneficiary individually, you can name any other person or entity to immediately become successor beneficiary upon your death. The public records will list the trustee but the property will be managed by you or by your agent.

Transferability. An ownership interest in a land trust is more easily transferred because you do not need to deed the interest, you merely transfer, by sale or gift, a fractional beneficial interest in the trust and no one will know the property has been sold or given away. In addition, if the property is sold, since you transfer only the beneficial interest and not by deed, there is no need to purchase new title insurance.

Avoid Liens and Lawsuits. Other benefits of using a land trust are the ability to keep the sales or purchase price secret, keeping liens and judgments off the property and avoiding litigation. This means creditors, ex-spouses, tax authorities and other potential claimants will not know you own the property. If it does not appear that you own much property, it is less likely you will be sued. If you are sued, it is less likely the property will be seized.

Avoid Probate. With a land trust, not only will no one know what real estate you own either during your life, they will not know what you own at your death. When you die, you can have the trust property distributed instantly to whomever you name in the trust. There will be no probate which means you avoid thousands of dollars in attorney fees and court costs and months of delay in distributing your property to your heirs.

If you own real property that could expose you to claims or lawsuits, the use of a Land Trust may be the most beneficial way to protect your assets and maintain privacy.

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