Top 5 Land Trust Mistakes

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Land trusts are a great tool for owning real estate. Many of my clients routinely use land trusts to avoid the due on sale clause in their mortgage, take title to property subject to an existing mortgage, or just hold title anonymously via a nominee trustee.
Despite the many benefits land trusts provide there are several ways to blow the benefits of this tool if the trust is not set up properly.
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ABOUT CLINT COONS
Clint Coons, Esq. is one of the founding partners of Anderson Law Group, Clint has grown his legal and tax firm to over 400 employees by assisting real estate investors with creating and implementing solid entity structuring plans. His success in these regards is in large part due to his personal investing experience. A successful attorney, real estate investor, and speaker, Clint has used his innovative and dynamic strategies coupled with knowledge borne from experience to help thousands of people save millions of dollars and build real wealth.
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The information provided in this video should not be construed or relied on as legal advice for any specific fact or circumstance. Its content was prepared by Anderson Business Advisors with its main office at 3225 McLeod Drive Suite 100 Las Vegas, Nevada 89121. This video is designed for entertainment and information purposes only. Viewing this video does not create an attorney-client relationship with Anderson Business Advisors or any of its lawyers. You should not act or rely on any of the information contained herein without seeking professional legal advice.

[@ClintCoons]

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[@clallen2000]

I have used the tax bill to track down investors that use land trusts but put their home address. Sometimes I have been able to even locate the owner if they used a PO Box on the trust and used the same PO Box on their LLC Registration. It is best to use an attorney as your trustee so they provide a buffer between you and the property. Furthermore, the attorney is protected by client-attorney privilege for being forced to turn over the information.

[@dcsco]

Exactly, what I was thinking too. That's what lawyers and Registered Agents are for. :-)

[@caligemini1982]

1- Do not use self as Trustee 2- Do not use home address on Tax Statements 3- Failure to Assign Benefit 4- Do not inform lender 5- Do not refer to trust as a Land Trust

[@ClintCoons]

Nice and succinct

[@YakMotley]

Awesome video! Thanks for the information!

[@bryanwoods6268]

Great video!

[@MusafirsSoul]

1st visit on his channel & wohoo I am impressed beyond I can express in words.. Thank you. Thank you!

[@ranevc]

Very knowledgeable, very cool!

[@Dee7771000]

This was well explained

[@TranNguyen-pk6in]

Thank you!

[@thenonlawyer3127]

awesome video. Now I know what questiions to ask my lawyer.

[@TheDeterminedminds]

Do you deal with Foreign Trust, if so do they offer more protection than a Land Trust? Thanks

[@macman9689]

Outstanding

[@danbutler3757]

Your video is great! The points are great information and I mean were those cockamamie states that doesn't accept them, I have utilized all Alternate names for mine. Thank you very much

[@leonmarcuscherry5118]

Clint! You are the sugar honey ice tea lol. You gave so much information and were straight to the point. Thank you!

[@DiscovertourshawaiiLLC]

Excellent info

[@ClintCoons]

Thanks

[@olternaut]

I am suddenly realizing the worth of working with a business advisor.

[@TruckTaxiMoveIt]

Thanks

[@ClintCoons]

Welcome

[@kenmiguel2986]

What do you think about irrevocable trusts? I read that it isnt actually irrevocable anymore depending on how its set up and depending on the state, so its not as rigid as before. Is it better to do land trusts or an irrevocable trust?

[@ClintCoons]

Irrevocable trusts do not work because they are inflexible. Once they are created you can't change the trust. With the strategy I am teaching we need flexibility in your ability to plan. the irrevocable trust does not offer that flexibility.

[@pamlogan6920]

Made an appointment to speak with an Attorney from this company and was call by a sales person without a JURIS DOCTRINE degree nor a license to practice law.

[@drbrycedavis]

That's usually what happens, I'm sure your hourly rate was low. Next time tell them you want to pay 300 an HR. My attorney charges 700 an HR. I much rather talk to paralegal if they can help.

[@terrycrawford6740]

@@drbrycedavis Same here. I was connected to a "Senior Strategist".

[@yyss4703]

Lawyer told me that I can not use my wy llc as trustee, bcs trustee needs special certificate in Illinois, is that true?

[@chicagorealtormike]

"I'm not telling you to commit fraud, but if you do, this is how you should do it" 😂😂😂

[@jcnevamind]

When you put an encumbered rental into this strategy, should I set up a trust banking account? What account should you use to pay the mortgage and what account should the tenant direct rent payments to?

[@ClintCoons]

Typically you will pay everything out of the beneficiary LLC. The trust does not have an account.

[@andyvaldez7714]

Got you. So put it under the name that you give the land trust. Smart. Thank you.

[@drbrycedavis]

If I want to take out HELOC or even a primary mortgage on my properties can I do that with a grantor (land) trust? If not what are the appropriate steps

[@ClintCoons]

Need to check with your lender. If the lender will not permit it then you will obtain the HELOC prior to moving the property into a land trust.

[@richardtruitt4646]

some professionals assume when you say Grantor trust that the grantor is also the Trustee as well as the beneficiary. Considering you want to use a WY LLC as the trustee and possibly as the beneficiary, this would cause major confusion and assumptions of their part.

[@ClintCoons]

It does

[@yyss4703]

If I have multipole rental properties, and transfer them to each individual land trust using a same wy llc or a same lawyer as initial trustee, is it easy to be found? do you have any good idea about it?

[@ClintCoons]

Not necessarily - one could assume you sold the properties to an investor.

[@MikeRivers23]

How about if you put an LLC from Wyoming or a state where the Owner is private and hidden as the Trustee, wouldn’t that be the best idea or not?

[@ClintCoons]

Mike watch some of my land trust videos. I discuss this strategy in detail.

[@andyvaldez7714]

The Post Office Box would be under your name as well. They could still track and find out who owns the property

[@Zenas521]

Shouldn't the PO Box be in the name of a Member Managed LLC which is owned by a WY C Corp?

[@etpeterson2087]

Get a post office box with a suite number and get the po box under someone elses name

[@youandme8082]

I still have a bit not clear. If you don't put yourself as a trustee on land trust from the financing property, the lender gonna see you're no longer own property. Is that gonna be trigger due on sale clause? Thanks Clint

[@ClintCoons]

Not likely. Lenders are looking to loan money not own property. I have ever come across an instance of a lender accelerating a note on a property held in a land trust unless the owner did something wrong.

[@ocpomtown]

Why do you choose Nevada over Delaware for your top level LLC? Also, can each property be under a Delaware or Nevada LLC rather than, say, a California LLC where the incorporation fee is much higher?

[@ClintCoons]

Actually I prefer Wyoming over Nevada or Delaware. Wyoming is less expensive. I prefer Delaware when I am using institutional financing for a project. Regarding the CA issue watch for my video coming out in 2 weeks on how to structure CA real estate.

[@ocpomtown]

Can you set up multiple Delaware/Wyoming/Nevada LLCs and register them to do business in California for buying/holding California properties to avoid the high LLC fees in California?

[@ClintCoons]

No California will tax you on each of these LLCs. In 2 weeks I will post a video describing how to avoid CA entity franchise tax.

[@yyss4703]

How to put the land trust to my living trust if I have assigned the interest to my LLC? if I put multiple LLCs to my living trust and then I got a lawsuit for one of the LLC, will it impact other assets which in the living trust?

[@ClintCoons]

If the LLC is in your trust then the land trust is also in the trust assuming you placed it in the LLC. If one LLC is sued it should not affect your other LLCs.

[@terrycrawford6740]

Does the Merger Doctrine also apply to Living Trusts?

[@ClintCoons]

No

[@themichaellindell]

I have a living trust and I'm listed as the trustee. I was quitclaimed my grandfather's home (currently a rental) and I'm now on the deed. I also have a WY LLC that is manager managed and the sole owner is the Living Trust. I want to transfer my primary residence and my deeded grandfather home into my trust but want the protection. Should I transfer the my trustee stays to my WY LLC or should I create a new LLC for the Trust? I also have a another business I run that is owned by that WY llc.

[@ClintCoons]

Consider setting up 2 land trusts - one for each property, with a WY LLC as the trustee of each of trusts. This will take your name off title and provide you anonymity.

[@themichaellindell]

@@ClintCoons I already have a living trust with me as the trustee. Should I transfer the current deed from my name into the living trust then transfer trustees or do I need to transfer the trustee into the WY llc before I file it?

[@armando9419]

How is the property insurance handle as far as the beneficiary when the bank pays for the insurance from your escrow account. The bank will notice a change when the insurance company changes the beneficiary.

[@ClintCoons]

Add the entity as an additional insured. The bank should not have an issue.

[@Theprimaryfocus]

I can't believe people really u their own name as a trustee...smh

[@extensionsonhousesbuilders1512]

can this work in the UK ?

[@ClintCoons]

Not sure. The statue of uses may prohibit some application of the land trust in the UK.

[@DiscovertourshawaiiLLC]

Gates just did same.mistake and was found out but they decided it was still legal for him to buy it :-( big chunk of North Dakota

[@ClintCoons]

Interesting - do you have a link to an article on this?

[@willd1213]

Should PO box be opened in your name? In name of one of LLCs? In name of the trust? Thanks!

[@ClintCoons]

I would open it in the name of an entity you can not be associated with. WE provide all of our trust clients an address in Wyoming or Nevada to route their tax statements to keep their anonymity shield in place.

[@rickeyalyles9169]

7:15 Anybody know the name of the act he mention? I didn't catch the name of that act and i rewind 10 times. That act is powerful I didn't know that.

[@terrycrawford6740]

Garn-St.Germain Act

[@John-ck2hp]

So complicated just to have some rental properties

[@ClintCoons]

Not really. Think of it like insurance. Once you acquire the protection it takes very little effort to maintain.

[@ocpomtown]

If you have say $5M in RE holdings, how does this compare with a simple $5M Umbrella policy?

[@ClintCoons]

An Umbrella policy only kicks in when the underlying policy pays out. Consider you are hit with a toxic mold claim. This claim is excluded under your landlord policy so your umbrella will not kick in and everything is left exposed. Don't get me wrong you should carry insurance but it is just one part of your overall plan.

[@ocpomtown]

@@ClintCoons Thanks. What about the pros/cons of a Land Trust structure versus an offshore asset protection trust?

[@ClintCoons]

I do not know enough about offshore to comment on its usefulness. We do not set up those types of structures but I have heard from professionals that offshore can be quite strong in the right circumstance.

[@theroyale_experience]

If i wanted these properties to leave for my daughter when she gets older, should she be put down as beneficiary?

[@marcduchamp5512]

Can people snoop out the beneficiary names? That would defeat the purpose of anonymity

[@cruzgonzalez3863]

@@marcduchamp5512 No, as far as I understand, the beneficiary names (and any transfership) are private documents.

[@terrycrawford6740]

If someone decides to go into litigation against the owner of a piece of property, does he/she sue the Trust, the Trustee, or the Beneficiary? Is the Registered Agent the one who gets served?

[@ClintCoons]

A trust does not have an RA unless it is a Statutory Trust. The Trust will be the named defendant but the Trustee will also be mentioned as the representative of the trust.

[@terrycrawford6740]

And since our Trustee is another LLC, is it the manager or member who needs to go to court? Or is it dependent on whether it's member-managed or manager-managed?

[@tonyhernandez7693]

Land trust doesn't protect you again a sued it;s a revocable trust. Just gt highest coverage in car and rental insurance and get an umbrella.

[@rashidaazucena2242]

I am still not clear on mistake #3

[@ClintCoons]

You need to assign your beneficial interest to an LLC for asset protection.

[@oddfella144]

I thought you had to have a physical address

[@ClintCoons]

For a land trust?

[@blazayblazay8888]

Because there’s no such thing it’s just a trust

[@ahsinsmith3963]

Guru who 🤣

[@terrycrawford6740]

Why do all your videos refer to these Grantor's Trusts as "Land Trusts" if we are never supposed to put the word "Land" anywhere in the Trust document?

[@ClintCoons]

Google search engine. Investors search for land trusts not grantor trusts.

[@terrycrawford6740]

But you do recommend that the word "Land" is nowhere to exist anywhere in the Trust document, correct?

[@ClintCoons]

@@terrycrawford6740 Correct except in Florida or Illinois.

[@quentinsebastianfostersr1592]

*****

[@rcruz401]

Hi Clint. I'm from Providence Rhode Island in the East coast and need help Setting up Asset protection. What is your Email so I can message you with details.

[@ClintCoons]

Reach out to my assistant Deborah at [e-mail]