Flipping REO's via Land Trust

I just flipped 3 properties today to a all cash investor using a land trust. I had never done it before and I was skeptical but I closed all three deals same buyer within 3 hours.

Here are the steps if you want to use a Land Trust to flip:

1. Put in your offer as xyz title vesting tba in escrow.
2. Get offer accepted.
3. "Street Name" Land Trust Trustee xyz (whatever buyer that is in Step One)
4. Find a cash buyer
5. Sell your land trust to Cash investor ( Wholesale Fee)
6. Cash Investor is the 100% beneficary
7. He wires money to escrow.
8. Property sold
9. Beneficiary (Cash Investor) fires xyz as trustee and assigns his own trustee for property.

NO EXTRA COST FOR A DOUBLE CLOSE USING TWO ESCROWS

NO EXTRA COST FOR TRANSACTIONAL FUNDING

NO COMPLICATIONS WITH ESCROW AND TITLE

Edited: 06/26/2010 at 09:20AM

Tim S.

Real Estate Investor · San Bernardino, California

9 posts
126 Influence

Icon_minipost Aug 12 '09, 10:07 AM

I agree, I have used this method myself, it is very effective when dealing with REOs (no assignment clause). You assign your beneficial interest in the land trust to the end buyer in exchange for your fee. Once the deal closes you resign as Trustee. In addition to the cost savings Anthony mentioned, the property gets recorded as "Street Name Land Trust" not the end buyers name.

Edited: 06/26/2010 at 09:20AM

Erica Thomas

Real Estate Consultant · Mobile, Alabama

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Icon_minipost Aug 12 '09, 10:26 AM

This site is amazing. I totally admit that all my experience has only come from the very conservative side of Real Estate. I have learned so much in 1 week, that I am almost overwhelmed! Thank you all so much for sharing your knowledge here. Even though I have been a licensed Agent for over 8 years, I am very much a Newbie to Creative Investment, and I want to learn as much as possible!

Edited: 06/26/2010 at 09:20AM

Anthony Clayton

Commercial Real Estate Broker · Fontana, California

68 posts
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Icon_minipost Aug 12 '09, 10:42 AM

Erica,

Real Estate you will learn something new everyday no matter how seasoned someone is.

I am glad I can be helpful

Edited: 06/26/2010 at 09:20AM

Brian Wall

Real Estate Investor · Santa Fe Springs, California

166 posts
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Icon_minipost Aug 12 '09, 11:00 AM

Were these short sale properties, REO's or ?

Did the original seller deed the property into the land trust, at the time you made the offer?

Edited: 06/26/2010 at 09:20AM

Anthony Clayton

Commercial Real Estate Broker · Fontana, California

68 posts
499 Influence
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Icon_minipost Aug 12 '09, 11:06 AM

REO, and no your cash investor paid all cash for the deed. So there is no transfer of deed without a sale.

You can do this on Short Sales also

Edited: 06/26/2010 at 09:20AM

Justin S.

Rehabber · Chandler, Arizona

1162 posts
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Icon_minipost Aug 12 '09, 11:14 AM

Anthony

Where these props listed on the MLS or were they pre-MLS finds?

Edited: 06/26/2010 at 09:20AM

Justin S., Wheelhouse Properties
E-Mail: wheelhouseproperties@gmail.com
Telephone: 4806780446
Website: http://www.wheelhouseproperties.com
Realtor, Re-modeler, Cash Buyer

Anthony Clayton

Commercial Real Estate Broker · Fontana, California

68 posts
499 Influence
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Icon_minipost Aug 12 '09, 11:19 AM

One I got from a REO agent before she listed it. The other two were from the MLS

Edited: 06/26/2010 at 09:20AM

Ty Hines

Real Estate Investor · Atlanta, Georgia

157 posts
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Icon_minipost Aug 12 '09, 12:02 PM

Great information Anthony! Very Useful!

Edited: 06/26/2010 at 09:20AM

Account Closed

36 posts
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Icon_minipost Aug 12 '09, 01:57 PM

Anthony,

How and where do you actually set up the land trust? Does it need to be filed with the city, county, state etc.? Does it need to be notarized? Does it need to be set up on a date prior to the offer being accepted by the bank? Are you as embarrassed about living in Fontana as I am? Ok, you can ignore that last one. But I am really hoping you can help me out with my other questions.

Thanks,
Joe

Edited: 06/26/2010 at 09:20AM

Anthony Clayton

Commercial Real Estate Broker · Fontana, California

68 posts
499 Influence
4 Awards

Icon_minipost Aug 12 '09, 11:04 PM

Joe,

You set up the land trust at home, at the park, where ever you like. It does need to be notarized but only after the sale (The cash investor only does this).

No it doesn't get recorded with city, county, nor the state. That is the reason people use land trust it is to hide ownership, if you record it; it wouldn't be so private.

Don't get it confused with a living trust. A living is recorded.

I like Fontana because I have a nice cash flow in my Fontana properites...lol

Edited: 06/26/2010 at 09:20AM

Steve L.

SFR Investor · Rancho Cucamonga, California

828 posts
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Icon_minipost Aug 13 '09, 05:09 AM

Hi Anthony,

Does a land trust have a yearly fee? When I've tried to wholesale properties via an LLC the buyers have had issues with the LLC fees etc.

We like Fontana too, buy a lot of properties there!

Edited: 06/26/2010 at 09:21AM

Anthony Clayton

Commercial Real Estate Broker · Fontana, California

68 posts
499 Influence
4 Awards

Icon_minipost Aug 13 '09, 05:17 AM

Cucaloco,

No, a land trust is a document not an entity

All,

If you want a copy of my land trust email me. I have got approval from my real estate attorney (he is the one that created my trust). I cannot give it to no more that 10 people per his request.

Edited: 06/26/2010 at 09:21AM

James Hiddle

Real Estate Investor · Altus, Oklahoma

2515 posts
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Icon_minipost Aug 13 '09, 07:00 AM

Hey Anthony if it's not too late can you send me the land trust? My email is in my sig.

By the way I take it you still pay the bank their required EMD?

Edited: 06/26/2010 at 09:21AM by James Hiddle

Account Closed

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Icon_minipost Aug 13 '09, 07:05 AM

Anthony,

I would really appreciate a copy of your land trust if you haven't already sent it to the ten person limit. My e-mail address is [REMOVED]

Thanks.

Edited: 06/26/2010 at 09:21AM by Administrator

Anthony Clayton

Commercial Real Estate Broker · Fontana, California

68 posts
499 Influence
4 Awards

Icon_minipost Aug 13 '09, 07:42 AM

Sometimes I do sometimes I don't depends how good of a deal is it. The better the faster I want to tie up.

Its about 50/50

Edited: 06/26/2010 at 09:21AM

Omar Albarran

Residential Lender · Beaumont, California

1 post
-6 Influence

Icon_minipost Aug 13 '09, 07:55 AM

Hello Anthony,

I'm trying to learn how to wholesale properties using a land trust. If you haven't met your quota would you mind sending me that land trust copy. [REMOVED]

Thank you in advance

Edited: 06/26/2010 at 09:21AM by Administrator

Joe Rodriguez

Real Estate Investor · Houston, Texas

3 posts
12 Influence

Icon_minipost Aug 25 '09, 06:25 AM

This is great information!!
Thanks Anthony

P.S. By the way..I ran across this post on search engine, then I decided to sign up after seeing your comment.

Edited: 06/26/2010 at 09:29AM

Anthony Clayton

Commercial Real Estate Broker · Fontana, California

68 posts
499 Influence
4 Awards

Icon_minipost Aug 25 '09, 06:46 AM

Joe,

Glad I can help. This is a great site and you will learn alot

Edited: 06/26/2010 at 09:29AM

Dwight Droze

Real Estate Investor · citrus heights, California

138 posts
673 Influence
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Icon_minipost Aug 27 '09, 11:33 AM

hey great info. I was getting really frustrated because i have 7 buyers with cash and a million reo's! I just couldnt find a title company to do the double close without freaking out. If you still have a copy left can i have one so i can see what this looks like? My email is in my signature.

As soon as i see the document im sure it will be clearer in my head on everything. since your in my state are you using any contingencies to protect you if your buyer decides he doesnt want the property?

im guessing you find a deal, put in the offer so there i room for repairs and what not, when its accepted you are having your buyers quickly check it out hoping they want it as long as its in their buying criteria right?

how would the earnest money work? just let the bank cash your check when he closes and you work that into your fee? are you getting paid at closing?

i cant think of any other questions but i just want to have some details and if i can get this down, i will do offers on sunday! Any help bud? Email me if you would! Thanks again and good luck!

Edited: 06/26/2010 at 09:31AM

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