All Forum Posts by: Scott Smith

@James Lim Hello! One possible solution is to use an LLC (preferably a Series LLC) in conjunction with a land trust. You purchase in your name and transfer the property into a trust after. Because this is a transfer to a land trust, typically you will exempt from transfer taxes. In addition, you avoid the "Due on Sale" clauses that come standard with most loans. This handy dandy loophole allows you to move and manage your property without having to cough up a bunch of cash.

As an added bonus, the land trust grants you, the investor, anonymity. The anonymous land trust is nearly impossible to penetrate in court.  The land trust piece helps prevent lawsuits by legally separating you from the property itself.

A few articles with more information can be found here, here, and here.

If you have any more questions, let me know!  

Best of luck!

@Costin I. Thank you for the mention!  And the great information you added.  Costin is correct regarding the fees and the lack of case law.  Thanks again, Costin!

@Wendell Burris It's never too early to have an asset protection plan. Especially if you plan to grow within the next 5 years. It may be more cost effective to have a foundation, rather than waiting down the line and having to complete several transfers. Have you heard of a Series LLC? You can read more about it in the articles I have posted here and here.

A Series LLC can offer compartmentalization, which will separate your assets, and asset protection through anonymity. Message me if you are interested in finding out more.

Best of luck!

@Aaron Montgomery Sounds like the start of a very exciting REI adventure. Wish you the best of luck. Regarding LLC formation for asset protection (a must), something you may be interested in reading about is a Series LLC. It offers compartmentalization to separate your assets, pass through taxes and fees, and anonymity through land trusts. You can read more about it in a few articles I have posted here and here.

Again, best of luck!

@Bret M Rankin It's never too early to have an asset protection plan. Especially if you plan to grow within the next 5 years. It may be more cost effective to have a foundation, rather than waiting down the line and having to complete several transfers. Have you heard of a Series LLC? It may be worth looking into, since you are planning to do fix/flips and house rentals. Keeping active and passive income separate can be important.

You can read more about the nuts and bolts here and here.

A Series LLC can offer compartmentalization, which will separate your assets, and asset protection through anonymity. Message me if you are interested in finding out more.

Best of luck!

@Donald S. Thank you for reaching out!  Message received.  I messaged you and am very interested in hearing about your particular situation.  Thanks!

@Greg W. Great questions.  The LLCs would transfer the properties to the individual series (child series) of a Series LLC (parent).  Each individual series is treated as a separate entity and therefore, one property will not be attached to another.  This offers compartmentalization and a stream lined approach.  In addition, it saves on yearly maintenance costs.  Anonymity can be created through a series of trusts.

Message me if you are interested in discussing this further.

Thanks for the response!

@Elaine Hester have you looked into a Delaware Statutory Trust?  Message me and I can send you a primer on it.  If structured correctly, benefits include cutting the $800 a year franchise cost, anonymity, and compartmentalization.  Also, you can scale it to fit your needs.

Best of Luck!

@Greg W. One possible route is a Series LLC. I wrote this post regarding the nuts and bolts of a Series LLC. As well as this one.  Check them out and let me know what you think.

Thanks!

@Eric Eckman and @Rik Chatterjee It is never too early to start putting together an asset protection strategy. Especially if you plan to purchase more real estate in the future. Just as thought you can look into when considering: Series LLC. Message me if you have any questions.

Best of luck!