Land Trust Privacy Shield In Question.

I have been using land trust privacy concept for many years and aside from a few closing agents not understanding them they have been flawless for keeping me anonymous in the public record. In addition, they can limit the beneficiary’s liability to a specific property versus all the assets of an individual. Some attorneys will disagree but I can find as many who will agree – so you draw your own conclusion.

Why would you want to be anonymous in the public record? In spite of what some attorneys tell you, I know they take cases based on the defendant’s ability to pay if they get a judgment that needs to be collected as well as the plaintiff’s ability to pay whether the case is won or lost. The easiest way to find out is a public records search for the proposed defendant’s and plaintiff’s assets – if no assets than why take the case?

A land trust is a simple document that has been in existence since the Roman times so it’s not a new invention. It is a “pass-through” entity so the IRS doesn’t issue a tax ID number unless they don’t understand what you are asking for. Since you aren’t getting a tax ID, you can’t open a bank account.

The main problem we encounter in real estate closings is an uninformed closing agent or attorney who wants to issue the proceeds to the Trustee of the trust – who doesn’t have a bank account to deposit the check or wire funds into. The number of closing agents who present us with this problem is likely less than 1/10 of 1% of our closings. This stubborn refusal to properly issue the proceeds of a sale is in spite of the Trustee giving the closing agent an “Authorization to Pay Proceeds” directly to the Beneficiaries – who will be paying the income taxes on the deal – NOT the trust.

Why is this important? As with most things in life there are always a few people who abuse the system. In some cases investors have illegally used land trust privacy to avoid paying for document fees, transfer taxes, hide assets in a divorce proceeding or bankruptcy and likely even to avoid paying income taxes. This is because the beneficial interest of a land trust can be transferred in minutes and there is no notification in the public record of the transfer – unless the transferee or transferor voluntarily does it.

For some years TSA has had a “No Purchase List” that screens people suspected or convicted of money laundering and it’s used quietly by every closing agent. But recently the US Dept. of Treasury – Financial Crimes Enforcement Network (FinCEN) has taken notice of large financial cash purchases that may have been done for the purpose of laundering money. Starting in March large cash transactions will be individually scrutinized for the source of funds and distribution of the proceeds of the sales.

I personally think that even more should be done to seek out the people who are avoiding paying taxes that law-abiding citizens wind up paying. I’m not on a soap box here but hurray for law enforcement and the next step should be land trust privacy disclosure requirements. Let’s face it; if you have something to hide for the regulatory agencies, you are most likely violating the law.

Land trust privacy use is just another benefit of the real estate mentor program training that we provide to all our mentor students.   As a real estate mentor, we look out for your interests and teach every mentoring student what it takes to succeed.

change your life mentoring click button j 300x236 1

To your limitless success,

Dave Dinkel

Real Estate Mentor Program Founder

Visit davedinkel.com for full privacy policy, terms of use, etc.  Be sure to contact us through the website at davedinkel.com if you have questions or concerns ([email protected]).  Results mentioned in this presentation and any video, article, and/or material related to Dave Dinkel and his associated businesses are not typical nor are a guarantee of any earning potential.  No advice is to be construed as legal, accounting, or professional advice EVER.  Please consult related licensed and qualified professionals before taking any action.  No person(s) mentioned in the articles and /or shown on videos received compensation in any form for their opinions.

Land Trust Privacy Shield In Question.

I have been using land trust privacy concept for many years and aside from a few closing agents not understanding them they have been flawless for keeping me anonymous in the public record. In addition, they can limit the beneficiary’s liability to a specific property versus all the assets of an individual. Some attorneys will disagree but I can find as many who will agree – so you draw your own conclusion.

Why would you want to be anonymous in the public record? In spite of what some attorneys tell you, I know they take cases based on the defendant’s ability to pay if they get a judgment that needs to be collected as well as the plaintiff’s ability to pay whether the case is won or lost. The easiest way to find out is a public records search for the proposed defendant’s and plaintiff’s assets – if no assets than why take the case?

A land trust is a simple document that has been in existence since the Roman times so it’s not a new invention. It is a “pass-through” entity so the IRS doesn’t issue a tax ID number unless they don’t understand what you are asking for. Since you aren’t getting a tax ID, you can’t open a bank account.

The main problem we encounter in real estate closings is an uninformed closing agent or attorney who wants to issue the proceeds to the Trustee of the trust – who doesn’t have a bank account to deposit the check or wire funds into. The number of closing agents who present us with this problem is likely less than 1/10 of 1% of our closings. This stubborn refusal to properly issue the proceeds of a sale is in spite of the Trustee giving the closing agent an “Authorization to Pay Proceeds” directly to the Beneficiaries – who will be paying the income taxes on the deal – NOT the trust.

Why is this important? As with most things in life there are always a few people who abuse the system. In some cases investors have illegally used land trust privacy to avoid paying for document fees, transfer taxes, hide assets in a divorce proceeding or bankruptcy and likely even to avoid paying income taxes. This is because the beneficial interest of a land trust can be transferred in minutes and there is no notification in the public record of the transfer – unless the transferee or transferor voluntarily does it.

For some years TSA has had a “No Purchase List” that screens people suspected or convicted of money laundering and it’s used quietly by every closing agent. But recently the US Dept. of Treasury – Financial Crimes Enforcement Network (FinCEN) has taken notice of large financial cash purchases that may have been done for the purpose of laundering money. Starting in March large cash transactions will be individually scrutinized for the source of funds and distribution of the proceeds of the sales.

I personally think that even more should be done to seek out the people who are avoiding paying taxes that law-abiding citizens wind up paying. I’m not on a soap box here but hurray for law enforcement and the next step should be land trust privacy disclosure requirements. Let’s face it; if you have something to hide for the regulatory agencies, you are most likely violating the law.

Land trust privacy use is just another benefit of the real estate mentor program training that we provide to all our mentor students.   As a real estate mentor, we look out for your interests and teach every mentoring student what it takes to succeed.

change your life mentoring click button j 300x236 1

To your limitless success,

Dave Dinkel

Real Estate Mentor Program Founder

Frequently Asked Questions

1. What Should I Do If a Seller Ghosts Me?

If you feel you have been ghosted, act decisively and quickly. If you have tried texting and calling, it’s time to drive by the seller’s location. I always take the recorded Notice of Interest or Memorandum of Contract to leave, so the seller knows it exists. Go by at a time when you know they will be there and don’t be confrontational, just get the facts.

In our experience with new investors, the chances of losing a deal with no contract is likely over 85%. Verbal commitments do not apply in contract law; get everything in writing, especially contract changes.

Different ‘gurus’ have different opinions, but our experience is finding motivated sellers and then a buyer for your deal. Ideally, you should be finding motivated buyers from day one, so you are ready when you find a seller. Buyers are easier to find as you can see at https://davedinkel.com/products/

Prevention only comes about by thinking a Black Hat wholesaler will be coming after your deal. First, educate the seller that an unscrupulous investor may come by and illegally offer more money, have the seller sign your “Notice to Homeowner,” stating that he understands he cannot accept another offer.

There is nothing illegal about changing their mind, it is called seller remorse and occurs about 25% of the time. However, if they have signed your contract, it can’t be cancelled for any reason unless acceptable to the investor/buyer.

If price is an objection, you need to find out how important it is to sell fast and for cash. If the seller isn’t under a time constraint, has a money issue, or has a personal dilemma, he may not agree to the price you need. Offer to help move and build it into your price before you make your offer. However, never give the seller money; only pay the moving company, and only after closing (escrow with a closing agent). If fear is the seller’s issue, break it down into what the real problem is and answer their objections one at a time.

You can get to the root of motivation for a seller by asking a few questions. First, “Why are you selling?”, “How soon can you close?”, and Are you ready to sign an AGREEMENT today, if not, what do I have to do to make you comfortable?’. The answers to these questions will determine the truth about your seller’s motivations.

The best times to involve your attorney in your deals are to have him review your contracting, review the signed contracts from the seller and end buyer, have him open escrow and start the title work, negotiate with city or counties for lien reductions or mortgage payoffs with lenders, and to close the transactions.” Your attorney is not the adversary; it’s the opposing party’s attorney who is a deal killer, and having your attorney allows him to help overcome this obstacle.

The key to successful prospecting and bringing back deals that didn’t close is to follow up until the property is transferred in the public record. Some of our deals have been where the seller came back to us months and years later because they felt comfortable with us and not the other “pushy” investors who contacted them.

Your contract’s most important clauses are inspection period (as long as possible), when the EMD must be deposited if at all, your ability to access the property, any added clauses specific to the property that will protect you against seller claims later that were verbal only.

Visit davedinkel.com for full privacy policy, terms of use, etc.  Be sure to contact us through the website at davedinkel.com if you have questions or concerns ([email protected]).  Results mentioned in this presentation and any video, article, and/or material related to Dave Dinkel and his associated businesses are not typical nor are a guarantee of any earning potential.  No advice is to be construed as legal, accounting, or professional advice EVER.  Please consult related licensed and qualified professionals before taking any action.  No person(s) mentioned in the articles and /or shown on videos received compensation in any form for their opinions.