In Florida, many owners of real property utilized land trusts to protect their assets from creditors, probate, and other potential issues. Indeed, land trusts are a powerful tool to provide asset protection and ownership confidentiality.
In this article, you will discover the benefits of a land trust in Florida.
Confidentiality of Ownership
A land trust in Florida can provide grantors confidentiality over their ownership of real property. In such cases, the public records of the county where the property is located will show only the trustee’s name and never the name of the beneficiary.
For instance, if a creditor in Florida searches the public record, he/she will not find properties purchased throughout a land trust.
Additionally, real estate investors may want to hide their identity and other real estate interests during the negotiations of commercial property in Florida. It happens because sellers tend to demand more money when they know a potential purchaser is a wealthy person.
Another good example of how the confidentiality of ownership is crucial is when a purchaser is trying to assemble adjoining land to fulfill a specific purpose.
Walt Disney is one of the best examples of a wealthy individual that utilized land trusts to buy thousands of acres of land to fulfill a particular purpose— in this case, building Disney World in Florida.
Private Transfer of Ownership
A land trust not only protects the privacy of its beneficiaries but also permits the owner to transfer the title of real property while preserving its privacy.
In such cases, an individual who owns an interest in a property may convey his/her stake in a property under a land trust by privately transferring their interest in the trust, either by sale or by gift.
Hence, unauthorized people will not discover the transaction or other sensitive information such as the transfer price or the buyer’s name (in case of a sale).
Saving Fees and Taxes
In many cases, a land trust may avoid the expenses associated with a new title insurance policy if a property is transferred by assignment of a land trust rather than through a deed.
However, it is worth noticing that land trusts may not be the most optimal manner to avoid government recording and transfer fees, so seek guidance with an expert attorney to assess your situation.
Depending on the situation, probate can be a nightmare for the family of a decedent who owned real property in Florida. Typically, probate is a time-demanding and expensive process, so the best approach is to avoid it whenever it is possible.
In this sense, a land trust permits the immediate transfer of real property to successor beneficiaries named in a land trust agreement. This way, a grantor in Florida can secure his/her legacy upon death and safeguard beneficiaries from probate court proceedings.
In Florida, the homestead exemption is a valuable tool to protect homeowners against property taxes. In this sense, the beneficiaries of a land trust can still qualify for homestead exemption, either for tax purposes or for protection against the forced sale by a creditor.
Protection Against Liens and Judgments
Except for homestead properties, a creditor’s record judgments automatically become liens attached to all real property title in its debtor’s name.
In this sense, state law provides that property within a land trust is protected from judgments and liens recorded against individual beneficiaries, considering that the interest of a beneficiary in a land trust is not real property.
Providing an Alternative for Shared Investment in Real Property
When two or more parties are interested in investing together in a property in Florida, they commonly form a partnership, sign a partnership agreement, and file a partnership certificate at the state level.
Nonetheless, land trusts can provide an alternative way for real estate investors who want to invest together in Florida real property.
Alternatively, two or more investors can express their business arrangement through a land trust agreement, clearly setting each party’s obligations and all the benefits assigned to each land trust beneficiary.
Notice that limited partnerships must be filed with the State of Florida, which involves a significant amount of fees. As land trusts are not filed with the State of Florida, the investors involved in the agreement will not be exposed to the same fees.
Protect Your Estate with the Help of Jurado & Farshchian, P.L.
Attorney Romy B. Jurado Esq. have expert estate planning attorneys to assess your situation and help you to structure a land trust in Florida.
Do not waste time and money with uncertainty. Call Attorney Romy B. Jurado at (305) 921-0976 or send an email to Romy@juradolawfirm.com to schedule a consultation today.