Posted by Rich[FL] on September 10, 2003 at 13:58:02:
Just so everyone will know, putting your homestead property into a trust with the proper wording will not affect the homestead protections in FL. I’m going through this right now with an estate planning person. This isn’t a “land trust”; it’s a joint trust (if you’re married) where the family’s assets (house, life insurance, investments, etc) are placed. The consultant I’m working with uses one of the top 25 estate planning/asset protection firms in the country (don’t know their name right off the top of my head), and they’ve done this before here in FL so I presume they know what they’re doing.
Question: Land Trust for personal residence? HELP! - Posted by John(FL)
Posted by John(FL) on September 10, 2003 at 10:32:35:
No response yesterday, so I’m trying again today:
My wife and I live in our primiary residence, which is a nice home in a nice neighborhood here in south FL. I bought the home prior to our getting married. My wife and I have occupied the home together for the entire time we’ve owned it. It is in all sense of the words “our home” in both our eyes and the state of FL, if I’m not mistaken.
We are in our late 40’s, early 50’s, and I recently got into REI. I haven’t done any deals yet, but have my business structure set up and marketing tools set up and have learned enough to know that land trusts can be a powerful tool in protecting real estate assets.
My wife had a bankruptcy not long ago that she recently put to bed using a BK attorney (while we were married) regarding a car she co-signed with her daughter that got totalled and some other personal debt. At the time that went down I was quite thankful the house was listed in only my name, as I thought we could have very well been skewered over that. Somehow, as far as the house is concerned, we survived that unscathed.
She would now like to be added to the title of the property. I have no problem with this. My wife does not fully understand land trusts (does anyone??), and thinks that simply placing the house in both our names will solve the problem. I want to do the right thing in the right way to both shield our home as an asset and provide us with the best financial rewards for the long term.
Trying to leave emotion out of the equation, my questions/concerns are these:
How can we get this done to give us the best setup for our future?
Is a land trust the answer?
Is there any valid reason or concern to cause us to decide to “do nothing”?
Posted by JT-IN on September 10, 2003 at 11:37:29:
John:
There is NO asset protection to a Land Trust… only the fact that it makes it more difficult to know if you own the property, or maintain the Beneficial Interest. Many folks are unclear about this, and think that a LT will afford you some magical asset protection… It won’t. In the case of property that you already own, (as is the case with you), you gain little with a Trust. Simply if a Creditor was detremining what assets you owned, and did a Grantor/Grantee search on you, and your home address somes up as a property that you once owned, and transferred into a Trust, then the rest is not difficult to figure out. If this was a new purchase, and you were buying the property directly into a Trustee’s name, then this is a different story. However, if a Creditor was to do a “Judgment/Debtor Exam” on you, and in that exam… under oath, they asked: "Do you had any ownership interest, including a Beneficial Interest in the property, via Trust or other titling mechanism…? To say No would be to committ purgery, and we all know that is a big No-No… (unless you are the President… sorry Bill C.).
As previously pointed out, FL has some very protective homestead laws. You may be voiding some of these priviledges by utilizing a Trust to begin with… (this I am not sure). However, before taking someone’s word on this site, (or others), and acting upon it, I would highly recommend that you seek the advice of an Estate Planning Atty. He/She can guide you best here.
What you are asking for here is “specific legal advice”, and this simply isn’t the place to find it…
Wish you all the best on determining the proper approach…
Re: Question: Land Trust for personal residence? - Posted by Chad (FL)
Posted by Chad (FL) on September 10, 2003 at 11:18:59:
One thing that I wanted to point out is that in Floirda, if you declare the property as your homestead, a creditor can not force a sale unless it is a voluntary lien (like a mortgage for example). The same goes for judgements, which is why OJ has moved here. He has a large judgement against him, but they can not take away his homestead. Florida is one of the few states that offers this protection.
From my understanding, they can attach a lien, but they can only collect if you sell the home and choose not to put the money into another homestead property.
I also wanted to recommend a great book called “Land Trusts in Florida” by Mark Warda. It’s written by a Florida Attorney and can probably answer just about any questions that you have. You can get it at Amazon.com for about $20.
JT,
Wasn’t there an angle where if you weren’t sole beneficiary (ie: LLC you control with 1% interest in the trust) the court couldn’t force the sale of the asset, just issue a “partitioning order” or somesuch.
Granted you wouldn’t be able to sell the place but you wouldn’t get put on the street either.
Lyal