Myths About Land Trusts
Image by Tumisu from Pixabay
By Randy Hughes , Mr . Land Trust
Iwrite and teach a lot about the many benefits to using a land trust to hold title to real estate investments . There is a lot of misinformation in the marketplace about Land Trusts and a lot of bad advice given regarding these Grantor Revocable Title Holding Trusts . After using these trusts for over 40 years I have found that the myths outnumber the facts . In this article , I will dispel some of the myths that I hear over and over . land trust the day after closing . Once you have four secondary market loans ( the maximum allowed ) you must use a portfolio lender and they WILL let you close by taking title directly from the seller to your trust . ( So , you are never in the chain of title .)
Note : Bank of America WILL let you close four secondary market loans using a land trust to take initial title . However , you must use an Illinois Land Trust and the property must be in Illinois .
MYTH : My lender will not let me close my deal using a Land Trust ( LT ).
TRUTH : This depends on if you are using borrowed funds from a lender that must qualify you in the secondary market . If you must meet secondary market guidelines it is true that you must close the deal in your name , but you can put the property into a
MYTH : Do I have to get a tax ID number for my LT ?
TRUTH : The answer is no . Nor do you have to register your trust agreement with anyone on planet earth ! ( There are two states that I am aware of that require disclosure of the beneficiary upon creation of the trust , via the deed to trustee , but this problem is easily solved .)
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