In real estate jargon, four of the most common ways that people own real estate are: ownership in severalty (owned by one person or entity), co-ownership, tenancy by the entirety (limited to husband and wife), and community property.
However the common thread that runs through each of these types of ownership is that whoever has title to the property that name or names are recorded in the public records for the entire world to see.
If it's fine with you for the entire world to know that you own your home and perhaps other properties, the option under discussion in this article will not benefit you. However, if you would like to keep your ownership away from the eyes of attorneys, bill collectors, tenants, and other similar types, then having your property in a land trust should be a clear and beneficial choice.
If it's fine with you for the entire world to know that you own your home and perhaps other properties, the option under discussion in this article will not benefit you. However, if you would like to keep your ownership away from the eyes of attorneys, bill collectors, tenants, and other similar types, then having your property in a land trust should be a clear and beneficial choice.
In Illinois, as in Florida, Virginia, North Dakota, Indiana, and Hawaii, by statute or court cases, the option of owning your property in a valuable way by using a land trust is available to you. Essentially a land trust is a type of ownership in which a trustee holds title to the property while the beneficiary of the trust (whose name is concealed) has the power to dispose of the property, manage the property, receive income from the property, and retains the obligation to pay the taxes on the property.
A trustee can only act under written direction of the beneficiary who can instruct the trustee to buy, sell, exchange, or mortgage the property. In other words, the sole function of the trustee is to hold title and sign documents, to transfer title to another, and to lease or finance the property all under the direction of the beneficiary.
A trustee can only act under written direction of the beneficiary who can instruct the trustee to buy, sell, exchange, or mortgage the property. In other words, the sole function of the trustee is to hold title and sign documents, to transfer title to another, and to lease or finance the property all under the direction of the beneficiary.
Another benefit is that the beneficiary's ownership is considered personal property and not an interest in real estate. The values of having the beneficiary interest considered as personal property are as follows:
- personal property has different probate requirements than real property;
- the beneficiary is protected against liens and other laws regarding real estate;
- a land trust allows the beneficiary to sell or give away portions of his interest without subdividing the property or deeding a partial interest in the real estate;
- personal property transfers are generally not recorded in the public records, the trustee is simply notified of any transfer of beneficial interest; and, the beneficiary of a land trust could even be another trust, perhaps a living trust.
Once again, a beneficial interest in a land trust is considered personal property and does not appear on the public records. You can easily and quietly transfer your interest in a land trust to someone else whenever you desire.
If you value privacy, ownership in a land trust should be seriously considered. Anyone searching the public records on your property will only you see the name of the trustee and not know who owns the beneficiary rights to the property. Let it suffice to say that whether you are a homeowner or investor, a good choice for you would be to use a land trust and let the title of your property be in the name of your trustee.
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