LLC As Trustee For Land Trust?
Hey-
I recall reading an article in "creative real estate" a while back re: setting up an LLC to act as a trustee for a title holding trust. Does anybody here do it this way??
I have an out of state LLC that I was planning to use.....anybody think of any pros or cons?
Any info would be appreciated.
Does an LLC need to be registered a a "trust company" in order to be named a trustee in a land trust?
Can you tell us what benefit you wish to achieve by doing this? Is it for
privacy and instead of using a person, you use an LLC? But when the LLC
signs as trustee, how would it read? Wouldn't you still have to sign
something like
"ABC LLC, Joe Smith as manager, trustee"
If that's the case, you wouldn't be able to maintain much privacy b/c there's still someone that needs to sign as an agent of the LLC.
Are you thinking about doing this for liability reasons? As far as I've
researched, the trustee can be indemnified from any acts they perform (aside
from negligence) on behalf of the LLC. So, there wouldn't be any extra
liability protection would there?
I know there are some people out there using this approach but I just can't
figure out why so, that's why I ask.
Thx
Hey guys..................the logic behing this scenario is that you are basically creating what amounts to a "dummy" trustee, without all of the potential pitfalls of using relatives,friends,soon to be ex-friends, etc..................my understanding is thatyou would just sign "ABC LLC as trustee", no names of managers..............you would also have to choose a state that will not disclose the membership information of the LLC other than the registered agent, unless under court order.........My understanding is that there are several states where this applies, New Mexico, for example...............by doing this in conjunction with a land trust, you can, it seems...keep actual beneficial interests known only to those who need to know. It sounds good to me but I wanted to know if anybody out there had any empirical evidence to support it!? .............also, according to William Bronchick...............if the LLC acting as trustee was holding itself out as a going business enterprise, offering trustee services to the public, there would definately be a problem with the State re: registration, but as long as the LLC is set up as a trustee to represent yourself, it would probably be overlooked......................
Everyone on this post seems to be more or less correct.
The trustee is the one who gets sued, but as long as she has exercised her fiduciary duties she will be dropped for the suit.
As trustee, I personally would rather get sued as part of an entity such as a LLC where even if I'm exculpated I know where my liability would end. And, if some faux pax made the LLC liablei I also know where the LLC'sliabiltity ends-(excluding fraud).
Forget the seminar stuff. If an attorney wants to get the names of the beneficiaries she will. It's just a matter of time and money (her clients).
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