Real Estate Investing 101 and Beyond

Let’s just get right down to it and really start to ruffle some feathers.  I will pose questions and statements I hear fairly regularly and answer them with a simple true or false followed by the answer I would give were I not bridled with those annoying little obligations of professional decorum and courtesy. Hey, it’s a blog. Anything goes. Right? 1.      Land Trusts Are Illegal:         FALSE Do all of you remember when your Mother explained to you the difference between stupid and ignorant? Well, I do and I won’t go into all the details, but the short version of that rant can be summed up with these two examples: a.       Ignorant means you have a lack of knowledge about either a specific subject or in general. I know nothing about nuclear physics and probably wouldn’t understand even if someone tried to teach me. I am ignorant when it comes to that topic. b.    ...

Now that you know all the players as discussed in Part I, let’s talk about how we can sub them out. The most common substitution in the land trust world is an assignment of beneficial interest. An assignment of beneficial interest is a very simple transaction whereby the current beneficiary assigns all or part of his or her beneficial interest to some other entity capable of holding title to real estate.   Benefit 1: The transfer can be accomplished via a simple 1 page document. Benefit 2: The transfer is not a matter of public record so there is, of course, the benefit of privacy; but also consider the fact that since there is no public record of the transfer you are essentially delaying the reassessment of your property value by the taxing authority thus keeping your property taxes lower.   Benefit 3: Your “closing costs” are cheaper. If you are assigning the beneficial interest for value you will save money by avoiding closing fees and title insurance. WARN...