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Land Trust-THE REAL ESTATE SAFETY NET
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Land Trust
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OK, What's a land trust? These simple title holding trusts were originally started in Illinois, so they are often called Illinois Land Trusts. The purpose of a land trust is to allow one to have the legal title to his property held by another person, or trusteewhile retaining all of the rights and privileges of property ownership (the beneficial interest). The trustee acts only upon the beneficiaries direction. The property owner still retains all rights, such as the right to possession, to collect rent, mortgage the property, homestead exemption, and any other benefit he now has. Avoid Probate, Save Taxes Property held in a land trust can be designated for transfer of ownership whenever you desire. Your spouse, children or other successors can bypass costly and time consuming probate proceedings and can sell or refinance the property without delay. Probates often take years to settle. With a land trust your heirs could sell immediately and avoiding making payments on the property they inherit but don't wish to keep. Protect Your Credit Report Public recordings related to your property will show up on your personal credit report, thereby lowering your credit score and access to credit. If you hold title to property in a land trust, any liens relating to your property will not report to your personal credit report. This allows you time to work out the problem more favorably since it does not appear on your reports. Insulate Your Property From Liens & Judgments Liens, judgments, lis pendens and claims by city and county government usually attach to property held by a person in his or her name, or as a co-owner with others. This can make the property more difficult to sell or refinance. Where the same property is held in a land trust, legal matters affecting the beneficiaries do not pass through to the subject property. About Partners and Tenants In Common Properties with more than one owner benefit greatly from a land trust. First, it isolates each owner from any liens, judgments or other public record filings from being attached to the property. It also allows for partners to readily and easily sell or transfer their interest to another investor. They can also gift the property to a family member whenever they wish without tax or reassessment. With land trust ownership, it is possible to sell property for cash and avoid the reporting of the sale to governmental agencies, thereby postponing or avoiding entirely tax consequences. By having only one trustee acting for all of the owners, there is no need for all of the owners to sign necessary papers, documents and contracts, which may become necessary from time to time. This saves time and confusion when there are several owners. Transferring Ownership Many cities and counties charge hefty transfer taxes when someone sells property to another person. They often reassess the property taxes and the taxes may be increased considerably. In California , it is possible that the property taxes could increase by several times. In a land trust, it is possible to privately transfer the beneficial interest in the trust (the actual ownership) without so reporting to any governmental agency. This is because a person's interest as a beneficiary of a land trust is considered personal property under the law. This can be extremely beneficial when buying out a partner or spouses interest in a property, or if you wish to deed the property as a gift to children or grandchildren. Privacy Legal ownership of all property is listed with the county recorder's office in all counties. That means your ownership information is available to anyone who wants it. That is why property owners are constantly solicited by mortgage brokers to apply for new loans. If you form a land trust, your interest in the property remains confidential. We believe that matters of real estate ownership should be private. You don't let everyone know your bank account number, or balances. Why let the entire world know the equivalent about your real estate holdings? A land trust offers a way to maintain privacy regarding real estate ownership. About Costs , LLC's and Corporations Many people advise real estate investors to place their property in LLC's and corporations. While this does afford some additional protection for some investors, it does not provide much more protection than a land trust alone provides. In fact in some cases it makes it worse since LLC's are public information. Also there are considerable costs involved with LLC's. Many companies charge $1000 or more to set up LLC's and corporations, and then there are annual filing obligations, taxes (minimum $800 per year in California) and accounting costs. For what? And then some companies end up placing the properties in land trusts anyway charging $800 or $900 for each one. Why? This probably is just not worth it, compared to the $349 we charge. Click this to form your land trust for only $349.00 When you order our complete set up for your new land trust we will take care of everything. Here is how it works: 1) First you will give us the basic information that we need to prepare your land trust agreement and the deed for transferring the property to the trust. This includes the name, address and other pertinent information of your trustee, beneficiaries and grantor. 2) We will prepare your complete trust agreement detailing all of the rights, obligations and duties of each participant, and prepare the documentation for you to sign and keep. Simply return the signed deed and endorsement to us and we will record it with your countys recorder. 3) In addition, we provide a land trust endorsement which will be archived with our licensed title and escrow company, which maintains a private record of the transaction which guarantees the authenticity of the trust for future reference by any other title company. This is very important. We are the only company that actually provides independent archiving of trust agreement and recording of the deeds by a licensed title company.
Click this to form your land trust for only $349.00 4) In addition we will remain available to help you with answers to questions you may have on using your land trust in the future. Our expert advisers will remain available to you at no extra cost to answer questions you may have regarding your trust. It's that simple.
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