In this YouTube Q&A, Chris Prefontaine answers a viewer’s question about whether to transfer property into a trust when doing subject‑to (sub‑to) real estate transactions. He emphasizes that the correct approach varies by state and by deal, and that having the right attorney and title company—those experienced with sub‑to deals—is essential. Chris explains that many sub‑to attorneys now recommend placing the property in a trust and then transferring the beneficial interest, but this must be evaluated case‑by‑case. He also addresses the misconception that title insurance isn’t needed in low‑equity deals, insisting that they always obtain title insurance and work with title companies that understand sub‑to transactions. He points listeners to smartrealestatecoach.com for free resources, strategy calls, and further guidance, underscoring a decade‑long experience in the niche.
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In some of these deals or all of them, do you transfer property into a trust? In what cases is there a trust involved?
I love how you start us off at 10:30 in the morning with a trust question. I can already see this guy's an attorney with all his attorney books back there.
Now I'm just kidding. Let me preface yearly. This is common. Let me preface it with a couple attorney comments I think are important. Important for everybody to know. Um, it's important before we get to your earliest question that you have the right attorney, right? Um, I can tell you, um, I've called many markets where 4 or 5 attorneys in a row— New Jersey was one of them— told me, no, you can't do that. I, I've gotten that a lot in states. But then I find one in that same state that has done thousands of sub-to deals, they tell me how to do it properly. So please make sure you have the right attorney. The dream team is important for you to assemble. We have great attorneys now after all these years in a lot of states. Yearly, uh, to get to yours. So again, we're not attorneys. We're going to tell you what we've— what we're told to do. Uh, yes, we have most recently been told by a couple of our main sub-to attorneys to put it in a trust and then, uh, transfer beneficial interest. Yes. But that's going to be deal by deal, state by state. I'm just generically answering. Uh, there's a second part of that question. Insurance. I know people scream on the internet that you don't have to buy title insurance because you don't have much money in some of these deals. We always do. Same with attorneys as title companies. You can call 2 title companies now and get 2 totally different answers. I don't do those, or yes, we do those, right? So you gotta find the title companies that'll do 'em. We have a title company, First National, that's also an attorney that's in 32 states that does 'em. Not sure where to get started? Go to smartrealestatecoach.com/getgoing for free books, strategy calls, and a whole bunch more. We're gonna help you get going the wicked smart way. We've been after this for over a decade doing exactly that.
So then the trust, so you transfer it into a trust and then you also buy title insurance when you do that. And it's, I guess the mortgage just stays on and the title company's fine with that.
Yep. If you get the title company that knows how to do 'em, yes. Yeah, same as the attorney. Where are you, Yurli? I'm curious, what market?
So I'm in Philly and despite what my books may look like, these are just encyclopedias. This has nothing to do with legal library.
You could have thrown that with Zach, but that's good for you to tell us it wasn't. Attorney?
But I am in real estate, so like, my wife and I are agents with Keller Williams.
