Is a revocable living trust + LLC combo good? - Posted by PrivacyFreak

Posted by innovator on November 25, 2005 at 15:01:23:

How would transfering the real and equitable title to a third party trustee in a title holding land trust, forming an LLC with your attorney as the registered agent and you as one of the members, then having your LLC be one of the controlling beneficiaries in the beneficiary directed land trust work?

Is a revocable living trust + LLC combo good? - Posted by PrivacyFreak

Posted by PrivacyFreak on November 24, 2005 at 02:32:14:

If I set up an LLC and a Revocable Living Trust
and assign the trust to LLC main contact/head
then can I hide my own name from showing up in the public records?

Re: Is a revocable living trust + LLC combo good? - Posted by John Corey

Posted by John Corey on November 28, 2005 at 07:38:24:

PrivacyFreak,

Go to the legal board and discuss this there. Some of the advice here is personal opinion based on what people think will happen rather than what is physically possible.

Ultimately you can not completely hide and still accomplish other things such as using the equity or track record to grow into more deals. Sooner or later you will find the trade-offs are too steep unless you already have enough and you just want to hide. In that case owning RE is not that interesting as it leaves too much of a paper trail.

Bronchick and other attorneys will tell you part of the true solution is to minimize what someone can attach and to do so in a way that they will rather settle for less than they might be awarded. Hence it is about reducing the profile, managing the control and containing the losses.

John Corey

Your Name Will Show Up In The Mortgage Records… - Posted by Ron, the Elite Investor

Posted by Ron, the Elite Investor on November 24, 2005 at 14:33:44:

I was once a privacy freak as well (years of investigating people as a P.I. will do this to you), but there is one thing you have to consider. Unless you are purchasing these properties as a lease/option or subject to the existing financing, your name will show up in the mortgage records as a borrower on the property. After this, anyone worth his or her salt would be able to put the pieces together and locate all of your properties. Whether or not they will be able to use this information to successfully sue you is another matter. I have used this method on numerous occassions to locate assets for attorneys and R.E. investors who wanted to buy a vacant property or lot owned by a corporation. Another alternative to hiding your name from the public (mortgage records), would be to set up a line of credit with a bank and purchase a property in the name of your LLC or corporation. If you want to hide from the secretary of state’s records, in most states you would have to hire your attorney or a REALLY CLOSE friend to be your registered agent and notarize a limited power of attorney to sign on their behalf, and you would make a trust the member of your corporation or LLC.

Ron Cormier

It should be simple - Posted by LeasePurchase

Posted by LeasePurchase on November 24, 2005 at 12:10:18:

A Title Holding Land Trust is a Revocable Living Trust. So, set one up and name your LLC as “a” beneficiary. It is kind of like wearing a belt and suspenders.

It hides, from prying eyes, your name etc., and forces a would be judgment creditor to nothing more than a Charging Order against your interest in the trust, not the property.

Even if someone were successful in; first, locating the property; second, finding out “if” you had any interest in the trust in your name; third, actually getting a Charging Order, which would force them to have to pay your taxes forever or until you took a distribution from the Trust and then the LLC. Oh yeah, did I mention that it is entirely up to you to report any distributions you took in your name, if any.

There is not “attachment” or way for them to know if or when you took such a distribution unless you reported it. In 25 years of Estate Planning I have never seen any Judgment Creditor pursue a Charging Order. It costs them tooooooooo much for very little if any return.

No Perfect Solution - Posted by JImmy

Posted by JImmy on November 24, 2005 at 05:50:30:

I’m not sure what you mean by “assign the trust to LLC.” Maybe you mean that you intend to have an LLC serve as trustee? Here’s the deal with entities as owners of real property:

  1. if the owner of the property is the trust, the titling in the county records will be “X, as Trustee of the Y Trust, dated z/z/zzzz” or something similar. the name of the trustee is always in the title, because that is technically where title is vested with trusts. If you want to keep you name out of the mix, then do not serve as trustee.

  2. If you put title in the name of the LLC, then only the LLC name will appear. But a Secretary of State search (via the web in almost every state now) will reveal some crucial details about the entity. You need to check your state’s website to see which details are sitting there for the world to see.

  3. Help me understand what you are concerned about. I’ve practiced in this area for 20 years, and dealt with legitimate issues of privacy (entertainment cients) and asset protection (wealthy folks in high-exposure fields, or otherwise exposed to liability). If you are freaked out about being sued becuse of thngs you have read or heard, but not because of specific issues in your life, your fear is probably irrational, and misplaced.

It doesn’t matter who or what is on the Mortgage - Posted by LeasePurchase

Posted by LeasePurchase on November 24, 2005 at 20:28:17:

It doesn’t matter if you are on the mortgage. What matters is if the property can be attached. If you place it in a Land Trust which transfers Bare, Equitable and Legal Title it doesn’t matter who or what is on the note.

As long as there are two or more unrelated Beneficiaries of he Trust it cannot be partitioned to satisfy a judgment creditor’s claim. One beneficiary holding 10% “beneficial” interest is you and the other is an LLC holding 90% beneficial interest.

Yes, the LLC should have a registered agent that is NOT you. Your attorney can be the registered agent as part of setting up your LLC. Mine is for all of our clients. The Trustee may not be forced to reveal who or what are the beneficiaries unless deposed. The only way the Trustee can be deposed is if the Trust is not setup correctly.

So even if someone knows you are the mortgagee it doesn’t matter. True, if you can buy homes with an LLC and your Attorney as the Registered Agent, I think that would be the best for the buck. However, most people don’t have an LLC with a Credit History to qualify. You may start by using Hard or Private Money to purchase and then later refinance I suppose.

What good does it do to find out you are the mortgagee if you are not the Legal or Equitable Title Holder?