Fri, Jul 03, 2009
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Best Way To Title Real Property ? |
hard-money-lender
25 Posts
Member Since: 11/29/2006
Long Beach, CA
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Posted: 11:52 on 07-20-2008
a living trust, with the proper clauses, receives asset protection from creditors of the beneficiaries, after the grantor dies.
what is the best way to hold title to real estate to accomplish ease of transfer with title companies, ease of refinancing with banking institutions, while keeping asset protection, but not using the same trust name as the living trust, to separate the ownership - so that if someone goes after the property, no other assets can be pierced ?
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JohnMerchant
2046 Posts
Member Since: 04/23/2002
Tacoma, WA
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Posted: 14:07 on 07-23-2008
I title investment properties in the name of an LLC as then it becomes pretty difficult for any creditor of mine to sue ME or come after any of my other assets.
Most banks see lots of this so they're used to dealing with LLCs and will frequently lend to the LLC without personal signature or guarantee by the owner of that LLC.
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smithj2
839 Posts
Member Since: 01/21/2004
Malden Brg, NY
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Posted: 17:36 on 07-23-2008
John,
I am surprised by your response. Every single bank I have dealt with (Countrywide, WAMU, BOA .. etc) will absolutely not lend to an LLC. They have all insisted that the title is taken in the personal name of the applicant.
Which banks are you dealing with to get non guaranteed signatures for loans to an LLC?
Thanks.
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hard-money-lender
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Long Beach, CA
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Posted: 19:59 on 07-23-2008
i dont know much about llcs, except here in california i think it costs $800 a year. i do know that people use llcs as their trustee.
from what i have been told, the illinois land trust (title holding trust) is easily used by banking institutions.
i dont know if you can put the typical asset protection clauses in those trusts, like you can the typical living trusts.
does this site have any good info on llcs ?
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ITBInvestor
525 Posts
Member Since: 09/07/2005
Holly Springs, NC
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Posted: 22:11 on 07-23-2008
smithj2, commercial banks don't mind lending to an LLC. Ive done it several times. The Wachovia types (Countrywide, WAMU, ...) will require a "DODI dance" first to get the personal guarantee (with deed to a natural person) so they can pass underwriting.
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thefullpriceofferguys
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Member Since: 06/10/2008
Simi Valley, CA
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Posted: 21:10 on 08-04-2008
im utilizing the illinois land trust (title holding land trust) to simulate lease options, wraps, land contracts etc.
i have few properties that are under non exclusive option contingent upon finding a qualified tenant to take over our payments and put up 3% towards trust contribution.
land trust is the main vehicle to hold real property for me. the beneficial interest can be held inside of an LLC as an extra layer of security.
i know of a good site that talks about title holding land trusts (illinois type)
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On 2008-07-23 19:59, hard-money-lender wrote:
i dont know much about llcs, except here in california i think it costs $800 a year. i do know that people use llcs as their trustee.
from what i have been told, the illinois land trust (title holding trust) is easily used by banking institutions.
i dont know if you can put the typical asset protection clauses in those trusts, like you can the typical living trusts.
does this site have any good info on llcs ?
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omicron3000
116 Posts
Member Since: 08/18/2007
Abington, PA
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Posted: 17:21 on 08-05-2008
Actually a land trust (also known as Illinois Land Trust) does not give you asset protection. It only gives you extra privacy, but a lawyer can file a court order to find the beneficiary of a land trust, upon forcing the trustee by court order.
As for the LLC, it generally keeps the debts out of your name, (limited liability). In addition to that, LLC's or LPs (firmer structure with older laws), can be used to hold property.
As for the LLC giving you protection, it depends on how the LLC is structured. Any kind of LLC for holding real estate, should never be single member EVER! Nor should it be managed by an individual, even though it is okay to have individual members, obtain some sort of distribution depending on your LLC agreement.
The living trust or living revocable trust is used for holding your own property, including personal property, that is in your name.
By the way if you have an LLC manager as an individual, and you guarantee the loan that will be a personal guarantee.
And if your LLC was found negligent, the owner of the property will have the veil of protection pierce and treated as a sole proprietor.
Also REI Club has saved teleseminars on this topic, as well. Listen to JOHN HYRE, he really gives you the cold hard truth, about Land trusts.
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