TRANSFERRING REAL ESTATE INTO YOUR LLC CLINT COONS
current titleholders of the real estate as the
the assignment of your beneficial interest in your
beneficiary. It is important to note that you should
land trust to the LLC you created for asset
not have unanimity of trustee, grantor, and
protection. This is accomplished with pen and
beneficiary. Whenever my office drafts a land trust
paper and a few simple lines reciting your intent
we will ensure that the trustee and beneficiary class
(be sure to have this assignment notarized).
differ by at least one person e.g., if John and Jane
set up a land trust then I will have John serve as the
The assignment will escape notice by your lender
trustee with John and Jane as the beneficiary.
because it will not become a matter of public
record.
The
assignment
remains
in
your
After the trust is established, John and Jane will
possession and for the curious sole that seeks to
deed their investment real estate into their land
divine the owner of said real estate shall only
trust. This transfer should not trigger the due on
come upon the name of your trust and its trustee.
sale clause that fosters so much angst and more
The trust beneficiary shall remain a private matter.
likely than not will garnet scan notice from a
inquisitive lender. Why? Thank congress. U.S.
This last step is the most important in terms of
Code Title 12, Chapter 13, Section 1701j-3 limits
asset protection. If you skip the LLC and remain
a lender from accelerating a note when there is
the beneficiary of your land trust you have not
a transfer to an inter vivos trust in which the
insulated yourself from the dangers associated
borrower is and remains a beneficiary… I forgot
with your investment. The land trust in and of
to mention, a land trust is an inter vivos trust.
itself offers no protection. In point of fact the land
trust will neatly package and deliver any liability
Once the transfer is complete, your property will be
on the doorstep of the trust’s beneficiaries.
titled in the name of your trust. At this stage in your
Hence, let your LLC be the beneficiary (or your
planning you are within sight of safe harbor and a
mother-in-law) rather than you individually and
few more strokes will safely see you home. To
protect yourself from your investments and your
reach safety the next step in your planning requires
investments from you.