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I’m considering putting some properties I own into land trusts. Question: why do some people list themselves as trustee rather than a lawyer, business partner, friend, etc.? I thought the whole point of the land trust was to get your name out of the public record. Any insights are appreciated.
Thanks,
Jeff.
Jeff, for a property title holder to list themselves as the trustee of a land trust is about as unwise (and unclear on the concept) as possible. Yes, one of the serious purposes of a land trust is to stiff-arm an opposing attorney’s ransacking of property records to see if there is attracive lawsuit bait to justify filiing a very nasty lawsuit. A trustee’s name on the public record is very good against such fishing expeditions. However, if such an attorney has any other clues about that trustee “maybe” being the link to our former title holder, it’s not uncommon for that fishing attorney to try to intimidate the trustee into revealing who really controls that trust from behind the scenes.An untrained trustee is vulnerable to such intimidation, and has been known to spill their guts to such a fishing attorney. A properly trained trustee (perhaps someone in the business of providing such trustee services) won’t roll over for such tactics. The point is that it is really a dumb idea to choose any random friend or stranger (as your land trustee) who doesn’t know when and how to stiff-arm such fishing expeditions.
Even more protection is a trained trustee in a well chosen different state than the property. That distance provides another, and more expensive, hurdle to discourage that opponent attorney’s fishing expedition. The more hurdles, the more mystery, and the more expense in that hunt, the less likely that such a lawsuit would ever see daylight.
Also, a properly trained trustee should be able to explain to you what a good land trust can, and can’t do, for you. There are some con artists in the business making claims of land trust capabilities that won’t hold up in court.
–Dee
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Dee,
Thank you for your insights. I can’ t understand why people put in their own names and was wondering if there was something that I was not seeing. I wasn’t planning on using a friend or family member for my trust but realize now that I need to look for an attorney more familiar with trusts. Surprisingly, many of them don’t know the first thing about them and advise against it although they really can’t articulate why you should not use one.
JeffJeff, earlier this year Jackie hosted an excellent conference call with a land trust expert in Florida, Jack Shea. You might like to look over his materials:
–Dee
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Jeff, here is just a freebie summary of useful things a land trust can do. It’s not guaranteed to be complete, but at this price…..10 reasons to use a land trust for real estate transactions
http://www.dealmakerlibrary.com/10-reasons-to-use-land-trusts-to-buy-real-estate.aspx
–Dee
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Dee,
Thank you for forwarding along both links. You’re absolutely right that Jack Shea is a great resource. I had the pleasure of hearing him speak and attend a dinner with him down in Florida and it was an opportunity not to be missed. The fact that CFD has so many recordings of his in the audio makes the membership so worthwhile. It’s funny, though, all the attorneys where I live keep trying to talk me out of a land trust. I think it’s because they don’t understand them. A friend gave me a reference to an attorney who does understand how they work so I’m going to talk with him. Thanks again! JB
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