Re: Land Trust Trustee - Posted by Bill Gatten
Posted by Bill Gatten on December 12, 1998 at 18:29:13:
Abe, your plight is a common one in my business.
First of all, to grant title to a land trust, you need anyone on title with you to sign off (e.g., with a deed to you in severalty, or with a Quit Claim Deed); or to sign the conveyance document which transfers title (legal and equitable)to whomever the trustee is.
However, once the property is in the land trust, now you would be well advised to assign a portion of your beneficiary interest (10% or more) to another (an unrelated party, preferably). In so doing your beneficiary interest, because it is now “personalty,” and no longer “realty,” becomes non-partitionable for judgement lien purposes. It’s not partitionable by the courts or by any judgement creditor, including your ex-wife, ex-business partner, or even the state or the IRS.
On the subject of whether you should be the trustee or not, its not a minor issue… the Bible on Land Trust (Kenoe on Land Trusts, out of the Univ. of Illinois) citing numerous historys, clearly indicates that a so-called “land trust,” wherein the grantor is the beneficiary and is also the trustee, is essentially a simple grantor’s trust, and would likely be found “Dry” or “Failed” if scrutinized, without any real benefit to you.
Further, to pass all tests, the trustee should be a party whose services are remunterated by the beneficiaries, with the Power of Sale, and who is either a trust company (.e.g. bank and trust, tile and trust, etc.) or a bona fide corporate entity whose sole function and purpose is to hold real estate titles in trust.
That was good advice you got from Brad Crouch on this one.
let me know if I can help further.