You work hard for your property and assets, and you need to find a way to protect them. You also want to make sure that you have a good way to pass your assets to your loved ones after your death. Managing and protecting your assets can seem overwhelming, but with the help of an experienced attorney, you will be assured of keeping your property under control.
What is a Land Trust?
A land trust is a legal entity that oversees property. The land trust is set up by the owner, called the grantor, and is designed to provide some protections for real estate. A land trust is a living trust that is specifically for real estate. It can also include related assets such as mortgages and notes. A land trust is a method that owners can use to manage their property while they are alive, as well as potentially prevent going through probate following death. It is a type of revocable trust.
Benefits of a Land Trust
There are some important benefits that you can gain with the use of a land trust. One of the main benefits of a land trust is that it allows an owner to separate some property from their personal finances. The land trust is a way to hold property anonymously so the owner can remain private. In this way, the property value is kept private, which can be advantageous in some circumstances. It can make probate easier, and in some cases, it can provide limited liability protections.
Potential Pitfalls of a Land Trust
While there are some advantages of a land trust, there are also some pitfalls that you need to be aware of. If you buy property under a land trust, you will not have redemption rights. This means that you would lose the right to reclaim the property in foreclosure. Land trusts are excluded from secondary market loans. It is also essential to know that even if a property is in a land trust, the owner may still have liability for it. A trust may not protect you from a liability lawsuit.
What You Need to Know About Land Trusts
Land trusts can be very useful in the management of your real estate as long as you do so properly. A land trust can be set up to your specific needs, so you can ensure that your concerns are adequately addressed. Land trusts are managed by the owner, and therefore, they provide you with flexibility. The land owner signs over the property title to the trust or designated title holder. This is called a deed in trust. Land trusts last for a designated period of time, and the owner may extend it. If the land trust expires, the property could be sold. It is critical to execute a land trust properly and according to the law so that you and your beneficiaries will benefit from the arrangement.
To learn more about land trusts, call us today at (608) 784-8310 or email us to request a consultation.