What is a Land Trust?
A Land Trust is a nontraditional ownership of Real Estate in the State of Illinois. Unlike traditional real estate ownership, a Land Trust allows institutions such as Chicago Title trust company or Old Second Bank to manage a trust for the beneficiary’s benefit. Beneficiaries include but are not limited to individuals, Revocable Living Trusts, LLC’s, and Corporations.
Advantages of a Land Trust:
- Property owners retain all rights to the property and keep the legal ability to rent, sell, refinance, and/or transfer the property to heirs upon death
- Allows anonymity, which provides asset protection and privacy, (Extremely important in today’s identity theft and rampant litigation society)
- Allows mortgaging and selling a Land Trust without having to obtain a deed
- Allows for an assignment of beneficial interest
- Simply and easily disposes property upon death to heirs, providing probate avoidance and ease of estate administration
- Protects property from mechanic’s liens and creditors
- Beneficial interest is personal property
- Partial distribution of property
Generally, the beneficiary or beneficiaries will sign the Land Trust Agreement, which explains the role and responsibility of the Land Trust Company, often know as the Trustee. Gateville Law Firm, will make sure that all of the proper documents are executed and created for your trust.
With a Land Trust Agreement, beneficiaries have the power of direction. Power of direction is the ability to instruct the trust company, or Trustee with respect to all matters involving the real estate property interest. The beneficiaries maintain control over the real estate property despite the ownership interest being in the Land Trust’s name. In the Trust Agreement, the beneficiary or beneficiaries highlight who they want to become the beneficiary or beneficiaries upon their death, which is a substantial benefit of a Land Trust. They also offer probate avoidance and ease of succession. A Land Trust avoids probate court involvement and the expenses associated with a probate proceeding.
The Illinois Department of Financial and Professional Regulation states the following about Land Trust:
“A land trust is a simple, inexpensive method for handling the ownership of real estate. It is an arrangement by which the recorded title to the real estate is held by the trustee, but all the rights and conveniences of ownership are exercised by the beneficial owner (beneficiary) whose interest is not disclosed. This method of owning real estate eliminates many of the difficulties that otherwise may be encountered in acquiring, owning, or selling real estate”. – Illinois Department of Financial and Professional Regulation
How are Land Trusts Created?
Gateville Law Firm can assist you with creation of a Land Trust. Generally, we will need a couple of forms filled out such as a W9, a Deed in Trust Agreement, and a trust Agreement. These documents describe your relationship with the trust Company. Our attorneys will make sure that any and all documents are properly created to insure a smooth transaction.
Who can benefit from a Land Trust?
- Property owners with equity in their home and want to avoid judgment liens or mechanic’s liens from being placed on their property
- Real estate investors gain asset protection and privacy benefits
- Police officers and other government professionals that want privacy and want their home and business addresses kept confidential
- People that want to create an easy estate planning strategy so their relatives avoid the expense of probate court
- Multiple owners of real estate] because an assignment of interest can be done instead of a real estate deed
Experienced Real Estate Attorneys
Gateville Law Firm is your experienced real estate law firm focused on residential and commercial real estate ownership. Unlike most real estate attorneys, the real estate lawyers of Gateville Law Firm have experience in estate planning, asset protection, and real estate coupled together. This benefits the client because often real estate lawyers do not properly understand simple to complex estate and advanced asset protection planning.
We do not require a consultation, but if your matter is complex and complicated, a consultation is recommended. We have a small consultation fee, which will be credited towards your final legal bill if you choose to hire us.