Land Trust / Living Trust - Posted by Jim

Real Estate Investing
#1

Posted by Bill Gatten on February 04, 2001 at 14:03:25:

Bud, I know what you meant to say, but just in case someone missed the point.

In a fully funded inter-vivos family trust, you’d be mssing the benefit if your didn’t record it; however in a title-holding Illinois-type inter-vivos real estate trust (land trust) you’d be missing the benefit if you DID record it. A properly drawn land trust will have a Prohibition Against Recordation within it, directing the trustee and all parties that the trust itself is never to be in the public record.

With a lsnd trust, the deed into the trust is recorded, but the trust itself is not.

Bill Gatten

#2

Land Trust / Living Trust - Posted by Jim

Posted by Jim on February 03, 2001 at 16:09:07:

Is there a difference between these two types of trusts?

I’ve been at the county courthouse and I see many “Living Trusts” that are recorded docs!

Are these two seperate things?

and… Is is legal “NOT” to record a Land Trust?

Jim

#3

Re: Land Trust / Living Trust - Posted by Brad Crouch

Posted by Brad Crouch on February 03, 2001 at 20:48:28:

Jim,

A land trust is a form of living trust, but it can only hold Real Estate as its “corpus”.

Recording trust documents is not something you want to do if you’re trying to keep your name out of the public records (trust documents would list the trustee AND also the beneficiaries). Trust documents and agreements only belong in your personal filing cabinet.

A land trust is beneficiary driven (or “directed”) while a living trust is trustee driven. A living trust usually holds personal property as its “corpus”, but it CAN also hold Real Estate.

Brad

#4

Re: Land Trust / Living Trust - Posted by Ed Copp (OH)

Posted by Ed Copp (OH) on February 03, 2001 at 19:07:11:

Same thing, and recording is not required.

Often the wording of a trust will state that it needs to be recorded in the beginning. The purpose of recording is to “give notice to the world” that the trust exists. So if this original recording did not take place there would be no way to know it existed.

#5

One point - Posted by lyal

Posted by lyal on February 04, 2001 at 09:05:16:

If, as in my state, recording (even in the DMV records for mobiles) is a requirement, that does not say you can’t use another entity such as a corp, llc etc or even another trust (stacked trusts) as trustee or beneficiary to keep YOUR name out of the public records. With some effort its possible to root out the info but most won’t go to the trouble.

#6

GOTCHA!!! - Posted by Jim

Posted by Jim on February 03, 2001 at 21:11:38:

Thanks Brad & Ed.

I’m aware of non recording of trust agreements due to the exposure of assets to liability, but I just saw these living trusts that were registered and was curious as if maybe we were just avoiding something we shouldn’t be.

I’m sure our teachers would have told us if it were not right.

Thanks Again, and Happy Investing

Jim

P.S. "Going to get my 1st deal (SUBJECT TO) signed up tomorrow! (I Hope)

#7

Re: GOTCHA!!! - Posted by Bud Branstetter

Posted by Bud Branstetter on February 03, 2001 at 22:50:39:

Most living trusts are done to try to avoid probate. If they are not funded they are useless. The deed to the trust isn’t too good if recorded after the death of the former owner. The idea of transferring title to the trustee helps avoid the exposure of assets. A property drawn living trust would have the real estate titled to the trustee of a land trust. Your losing the benefits of the trust if you don’t record them.