Why a Land Trust May Be Beneficial for You

Land Trust

If you are into asset management, you may be familiar with different types of trust agreements. If you are particularly inclined to real estate, you may be aware that land ownership can be quite tricky and challenging. There are various legal procedures that you must go through to secure the title of a property, and even then, you may encounter some bumps on the road.

One type of trust agreement that you can utilize for your property is a land trust. This trust is a legal agreement wherein an individual known as the trustee holds the title of your real estate.

In this agreement, you, as the owner, will retain your ownership rights. Essentially, the owner of the property still has control over all assets, but the trustee is considered the owner for legal purposes.

A land trust agreement has numerous functions, with one being anonymity and protection. In the United States, only six states offer land trust agreements. These are Indiana, South Dakota, Florida, Hawaii, Virginia, and Illinois.

Types of Land Trusts

Types of Land Trusts

1. Community Land Trust

A community land trust is typically utilized by non-profit organizations to help residents have access to affordable housing. Usually, you would have to pay for both the building structure and land to become a homeowner. However, this type of trust allows you to pay for only the building structure to allow more people to become homeowners.

2. Conservation Land Trust

This type of trust, on the other hand, is used to protect natural areas, landmarks, historical sites, and the like to preserve these places. It is particularly common for areas where you may find endangered plant and animal species.

3. Corporate Land Trust

Also known as the real estate land trust, this type of trust agreement is one of the most common among the many options. You would commonly see this used by conglomerates, corporations, or large buyers. Using this allows you to acquire or purchase real estate without letting the public know.

Benefits of a Land Trust

Benefits of a Land Trust
One of the primary benefits of using land trust agreements is it provides you, as a property owner, with privacy and legal protection. At times, these types of arrangements may be used to buy land discreetly or to avoid prices of property from shooting up.

Once the trust is fully processed, your name as an owner can no longer be publicly revealed without a court order. If an asset has multiple owners, then using land trusts will protect the other owners from legal charges if these are only brought up against one of the owners.

Using land trusts also makes it easier to transfer ownership of the property to beneficiaries. The trust stays in place, following whatever succession plan may have stipulated in the beginning. Doing this will allow you to avoid going through the lengthy and costly process of probate, so the property immediately passes on to the heirs.

Land trusts can also protect real estate from partition proceedings. Since the trustee owns the property, beneficiaries need not worry about the risk of one of them forcing a division or sale of a property.

There are several benefits to land trust agreements, but given that they involve your assets, you must get yourself acquainted with how these procedures work. Information-gathering may be done by consulting a professional or looking up information since it is not easy to set up trusts without help.

By familiarizing yourself with how land trusts work, you can ensure that you reap all its benefits and avoid any complications. By seeking help from consultants, you get a better idea of how land trusts work and also see the range of options available to you.

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