Land Trust

Land trusts offer some benefits but may not be good asset protection strategies. A land trust can be broken. In court of law, a land trust may not hold up. For asset protection, don't rely on land trusts.

Understanding land trusts - what is a land trust?

In a land trust, you control everything and you and your family are the beneficiaries.

What happens to land trusts in court?

In court, a good lawyer is going to say you have too much control and that this land trust is invalid. Top asset protection attorneys often say that land trusts are good asset protection strategies in theory but in court they may not hold up. Land trusts do offer some benefits such as the anonymity.

Example of how a land trust may not hold up in court

Patrick owned 10 properties. All of Patrick's real estate properties were in land trusts. Patrick then had big lawsuit against him.

Questions Patrick could say no to...

The plaintiff's lawyer asked if Patrick owned any real estate property. Patrick said no. The lawyer then asked if Patrick received any income directly from any of the real estate properties that he owned. Patrick said no because all of his real estate properties was owned in land trusts so Patrick did not own any real estate properties - the land trusts owned them. In this case, land trusts would save Patrick from the lawsuit. But, only if the lawyer does not know how to ask proper questions.

Questions Patrick could not say no to...

If the lawyer asked Patrick "have you owned or do you have any interest in any real estate property or entity that owns any real estate property" then Patrick would have had to say yes. In this case, a land trust would not help Patrick's case and a land trust is not an asset protection strategy Patrick should have had.