Closing Attorney does not offer Land Trusts
Hi. My agent informed me his closing attorney does not do land trusts and we close later today. What would you do in this situation?
This is a cash purchase, can I transfer to a land trust later on? What are the usually fee for this? Or is it too late to hide anonymity
You can transfer after the fact via Deed from currently named buyer in the contract to the land trust but there are a few things to remember:
1. if you deed to a land trust later you also need to change the name of insured for your hazard insurance.
2. Depending on the underwriter of your title insurance policy, a change in the titled owner if different from the name of the insured on your title policy may void title coverage. Check with the closing agent.
3. Yes, there could be a presumption that the current owner (you or your LLC) just deeded it to a land trust for which you are also the beneficiary, but if done correctly just as strong of a presumption could be made that you or your LLC deeded to a land trust for which a completely separate third party is bene. There is no way to know who the bene of that land trust is -the third party could be a joint venture partner of yours, a private money lender, your spouse who wants a divorce and has demanded the house while working out the particulars - this list could go on and on... point being, presumptions don't do anyone much good and if the transfer is done correctly you will be fine.
Originally posted by @Laura Richards:
You can transfer after the fact via Deed from currently named buyer in the contract to the land trust but there are a few things to remember:
1. if you deed to a land trust later you also need to change the name of insured for your hazard insurance.
2. Depending on the underwriter of your title insurance policy, a change in the titled owner if different from the name of the insured on your title policy may void title coverage. Check with the closing agent.
3. Yes, there could be a presumption that the current owner (you or your LLC) just deeded it to a land trust for which you are also the beneficiary, but if done correctly just as strong of a presumption could be made that you or your LLC deeded to a land trust for which a completely separate third party is bene. There is no way to know who the bene of that land trust is -the third party could be a joint venture partner of yours, a private money lender, your spouse who wants a divorce and has demanded the house while working out the particulars - this list could go on and on... point being, presumptions don't do anyone much good and if the transfer is done correctly you will be fine.
Fantastic coverage of the issues Laura.
I would only add:
4. Be wary of the impact any such future transfers may have on your financing agreements.
