https://www.listennotes.com/e/12f4bcd8200e41d3af4aa7aef5629ad0

Get ready to find your recipe for a successful real estate lifestyle from America's top experts here at Greenlight REI with your host, Lance Edwards.

Well, hello, everyone. Hi. This is Lance Edwards. Welcome to this edition of Greenlight REI where you come here to learn the recipe for the successful real estate lifestyle. And I have a special guest today that works in a really, a very important part of real estate, and it's something you may or may not be familiar with. It's in the area of a vehicle called Land Trust. This is where you create privacy. And who owns, who owns the real estate. And his name is, get this, Mr. Land Trust. So this man knows about Land Trust. He is dedicated. We're going to find out more about it. Much of his professional adult career to the use of Land Trust in real estate. He's a national educator. He travels the country speaking at groups all over the country. I've known this gentleman for years, for years, and have used it, actually use his product myself. He has a great home study system. He has other educational events. But he has a free gift for everybody today, just for listening today, it's his reasons to use a Land Trust booklet. Reasons to use the Land Trust booklet the way you're gonna be able to get it for free. I was going to tell you right now on the show Notes, which I'll tell you how to get there in a little bit on the show Notes for this podcast. We'll have a link there. And you go there, you can Download immediately Access Mr. Land Trust Book on Land Trust. And So with that, Mr. Land Trust, thank you for joining Greenlight REI.

Hey, it's nice to be here, Lance. Thanks for inviting me.

Absolute pleasure, absolute pleasure. And I want to start off the question again. I got a number of questions for you, so I want you to share the story. How did you first, I don't know, discover Land Trust, get involved with Land Trust? How do you become Mr. Land Trust? Where did it begin?

Well, that's a great question. I started buying houses when I was in college, Lance, and I'm a house guy. That's how I make my living. I bought my first house when I was 19 and have been buying and holding houses ever since. And probably back in the early 70s, I had about 15 houses in my name personally. I was on the deed until I woke up one night and I thought, man, that is really stupid. Anybody can go to the county records and look up what I own, what they're assessed for, and what my debt was when I bought the properties. And, and with those Numbers, you can pretty much figure out my net worth and whether or not I'm worthy of being sued. Most, most real estate investors don't realize that attorneys don't support people and they will investigate you before they decide to sue you or not. And the, and the, the leading way to investigate you is to go to the courthouse records and find out what you own. Because, you know, having cash or stocks or bonds, those are easy to get rid of if somebody's suing you and to make yourself judgment proof. But if you own real estate, it's not so easy to unload a 100 unit apartment building. And that's why lawyers and their contingency fee, lawyers in particular, and their deadbeat clients that don't want to work like hard for a living, like you and I and the people watching this, they want to sue somebody to get rich. And that's what they do, is the first thing they're going to do is type your name into the county record and up pops, you know, 10 or 20 or more properties and whammo, you are a target. So I thought, you know, I got to get off these deeds. And so I started investigating different ways of owning real estate. Certainly you can do it in a corporation. And at that point in the 70s, there was no such thing as a, as a LLC. But there are other trusts and other things, other vehicles that you could use to hold title. And living in Illinois, as I do, Illinois is the granddaddy of land trust law. And so there was a lot of, lot of case law here. The very, very first land trust in America was formed here in the suburbs of Chicago. And so I was able to get a lot of good information. And, and I, I, once I figured it out, the best way to do this, I deeded out of, out of my name on all those 15 houses and into 15 separate land trusts. And that's one basic tenet that I teach my students is everything should be in a separate trust. I know a lot of attorneys that advise people to put their properties in a LLC. And I use LLCs. Lance, I'm sure you do too, but I don't use them to hold the title because that aggregates your assets into one spot. And most LLCs, we can look up who owns them unless you form them in, you know, states like Wyoming or Nevada or Delaware. So we can look up who owns them. So there goes your anonymity again. And also, if you had, let's say you had 10, 10 apartment buildings and you put them all, titled them all in one llc, and there's a lawsuit on one building that has nothing to do with the other nine buildings. But they sue and they win a judgment against the owner. The owner is the LLC. Now they got a judgment against all 10 of your buildings. And you can't sell, you can't refinance, you can't do anything until you resolve that judgment. So a basic tentative asset protection, be it cash, stocks, bonds, or real estate, is separation of those assets. You don't lump them all into one, anything.

All right? So you got. You got this start. So first of all, kudos. 19 years old, you owned your own, your first rental property. That's darn impressive. That's darn impressive. So for everybody to explain, what does a. Or for everybody to understand a land trust, explain, what is that? What does that really mean? You know, it's a document. They got a trustee. Can you walk through somebody so they can understand the mechanics of it?

Well, the easiest way to think of it is it's a title holding trust. The IRS calls them grantor revocable trust. Revocable, meaning you can change it, but it's just really, it just is a. It's a vehicle to hold the title in somebody or something else's name. It could be an entity or an individual where they hold title for you, and you or your entity is the beneficiary of that trust. And, and they can't do anything unless you direct them to do so in writing. But if you type in my name into the county records, you're going to get zero. And. And that's where you want to be. Is it zero in the county courthouse records?

All right, so right now, so what. What name is on the. Is on the trust document? How are they recorded? What would the name of the trust be if they were trying to do a search so people can understand that.

Yeah, there are really two things we need to create a trust. We need a deed to the trustee, and we need a trust agreement. That's the contract between the trustee who's holding title and the beneficiary. That trust agreement is not recorded anywhere on planet Earth. And that's what gives you your privacy of ownership. The only thing that's recorded is the deed to the trustee and the name of the trust. You know, so it could be Billy Bob Thornton for the red, white and blue land Trust number 1234. And that's one of the cool things about this, this trust issue is you can name your trust anything you want to as long as you don't infringe on other people's copyright. So that leaves a wide door open. You don't have to go to the state like you do when you form a corporation or an LLC to check and see if the name's available. You can name it whatever you want. And I, I sell a home study course that has a whole chapter in it on just how to name and number your trust. Because I think that naming your trust can be an asset protection technique in itself. Most attorneys that, if you can find one that knows how to do these trusts, which they're not many, but they will recommend that you name the trust after the property address that's in the trust, you know, so name it. The 123 Vine Street Trust. Well, I don't think that sounds very intimidating and doesn't really serve the purpose that I'm looking for. So I want to give my trust a name that might apply to some nefarious character that's kind of trying to sue me for some frivolous reason. It might imply to them that, well, maybe I should sue somebody else today. This trust sounds like it may have a. Maybe it's got its own legal department and they'll come sue me back, you know, may, maybe this, maybe that. So I want to put questions in their mind. I don't want them just to see a 1, 2, 3 Vine Street Trust and say, oh, we're going to go sue that. That's just no mom and pop. So I got a whole chapter in it. And that, like I said, it's fun to name a number. You can code these trust names. You could, you know, just with all kinds of creative thinking. For example, let's say you had two kids and you wanted to leave one trust to one kid and one to the other, you could name the trust whatever you want. And then in the number you could put the children's initials. So, you know, anytime you look at that trust, that that trust is going to go to your daughter and the other one's going to go to your son. Just a myriad of things to do and to create when you're naming and numbering your trust.

All right, so let's. You open up a couple of doors there. So you have a trustee for the trust and you have a beneficiary of the trust. The trustee could be John Smith. John Smith, trustee. The beneficiary will be, for example, Jane Doe, or it could be Jane Doe's llc could be part of the beneficiary. Correct?

Right.

So when it comes to the only name that's on in the, the Records is going to be John Smith as trustee of whatever the name of the trust is. Correct.

Exactly.

Okay. And what rights does the trustee have with regards to the asset to the real estate in this case? What responsibilities? What rights do they have?

Well, I don't want my trustees to have any duties or responsibilities. All I want them to do is hold the title and they cannot act and do anything without my written direction. Trustees have no personal liability. There's 100 years of case law that that proves that unless they go rogue on you and try to do something on their own without written direction, and then they would have personal liability. So it back to my home study course I mentioned earlier. I've got a whole chapter in there on who can be and who should be your trustee. So I give you a lot of good recommendations. But the short answer to that question is it should be somebody with a different last name than you and somebody that lives out of the county in which the property is located. And I do like individuals as trustees as opposed to institutions like Chicago Title, they've got a trust department and they manage 65,000 land trusts. They're the trustee on 65,000 land trusts. But, you know, I don't want an entity, I want individuals for a number of reasons.

All right, so in creating this document, this land trust, a document in it, is this something that the individual can do on their own or they go to attorney? And you mentioned that there's not necessarily a lot of attorneys even practice with much with land trust. Speak to that. Doing it yourself versus going professional help.

Great question. I get that a lot. Well, first off, attorneys, I've talked to a lot of attorneys and they've all told me they don't get taught land trust law in law school. So unless they take it upon themselves to learn it after law school, they don't have a clue. And that's why many attorneys say, oh, you don't need a land trust, they're no good use an llc. Well, I think the land trust gives you privacy element that an LLC doesn't. And I agree that LLC does have better asset protection than a land trust. So why don't we use both of them? So let's title our real estate in the land trust to get the privacy element and let's make the beneficiary of the land trust the llc. Because just because you put your property into a land trust doesn't mean there's no more liability on that property. The liability on that property flows through to the beneficiary, and that's why most real estate investors will make the beneficiary of their land trust an LLC for that added asset protection. Does that make sense?

Yeah, it's like a belt and suspenders approach. First of all, there's the anonymity. You don't, you really don't know who the owner or the beneficiary is. And even if you were to figure that out, it's in this LLC over here. Is that a fair success, a fair statement? What I'm saying, yeah.

And what would happen is they'd have to sue the trust first. They'd have to find the trustee and bend their thumbs back in court to find out who the beneficiary is. And then they go after the beneficiary, which is going to be your llc. But, Lance, let me stop right here and make a statement, because people that sometimes when I'm talking about protecting assets and privacy and all that, some people get a little uncomfortable and say, well, wait a minute. What, what's this guy trying to hide? Is he doing something illegal, immoral, or fattening? What's going on? And I, I can tell you after 53, 53 years in this business, I've never gone bankrupt. I've never not paid a note. I've never backed out on a promise that I made, no matter how hard it was for me to deliver. And. But there are a whole lot of people in this country that don't want to work hard like I have done and like you've done over a lifetime. And they want to sue to get wealthy. And so it's kind of an oxymoron in our business that the more successful you become, the greater target you are for a lawsuit. So my advice is to the folks watching and listening to this today is you need to spend some time learning how to protect your assets as you're acquiring them. You can't just go through life acquiring these assets and thinking that life's going to be a rose bed forever, because the longer you're in this business, the greater the odds that you're going to be challenged in some way. And so I'm not saying we're using these trusts to take advantage of people or avoid our just responsibilities in life. I'm just saying that I think if you come after me and my family, our assets over some frivolous issue that I'm not responsible for, then I think I've got every right in the world to defend myself and my family as vehemently as I can.

Well, it's just, it's a legally available tools for that purpose. And you said it has over 100 years of case law in Illinois alone. Just one of the tools we have, you have got to use to protect yourself. Let's go back. Okay, so you've got this, you've got a land trust and still there's a question. Do I create it? Do I, can I do it myself, or do I need to go hire an attorney? Do I need to find an attorney that knows, you know, taught them, went on their own and learned land trust? So talk about that. Do it yourself versus professional help.

Yeah, I got off on a tangent there. Sorry. So since most attorneys aren't taught this stuff in land, the land trust information in, in law school, it's difficult to find one that's educated, but there are many out there. My personal attorney I use on every real estate transaction. I highly advise real estate investors to always use an attorney when they're doing their transactions. But the problem is that if you're going to be very active in this business, you're going to have a, you're going to deal with a lot of property. Buying, selling, holding, rehabbing, contract assignments, all the fun things there are to do in this business. You're going to deal with a lot of property and therefore it becomes too expensive to hire an attorney to create a trust for every property you touch in your life. I do have people come to me from time to time and they say, I don't want to learn how to do this myself. Refer me to an attorney, and I do. And she charges $2,500 per trust. So, you know, how much of that can you stand? Now on the other end of that spectrum, I had a guy called me a couple of years ago from Kentucky and he said, I want to buy your home study course and learn how to create my own land trust. I said, well, that's great. What do you, what specifically are you going to do with them? He said, well, I'm down here in Kentucky, I've got 1500 oil and gas leases and I. Some of them are going to go boom and some of them are going to go bust. So I want to put each one in a separate trust. And that's what he did. And for 597 bucks, he bought my home study course and created 1500. Can you imagine? I don't even know the math. 1500 times 2500 is a whole lot of money. You know, if he'd had to hire an attorney to pay $2,500 per trust. So it really Behooves you if you're going to be serious and a long term investor to just to learn how to do this yourself. It's not hard. You understand it a lot better if you do it yourself and you have total control over, over all the paperwork and naming the trust and numbering the trust and all the things that are fun to do in this business.

All right, very good. And it would seem to me it kind of, if you get it to a volume like that, you may guess I look over your shoulder for the first one and created the template. Then it's, I mean, literally a matter of kind of filling in the blanks in terms of property number 2, 3, 4. As long as you're happy with the templates you have. Is that a correct statement?

That is a correct statement. In fact, I offer to my students, anybody that becomes my student, if they want to put together their first trust using my trust agreement that I provide them in my forms, send it to me. Then we get together over the phone and on the computer, we look at it, go through it together and make sure it's exactly the way they want it. And then they do, they have a template that they can use, use over and over. And it would literally take them five minutes to spit out a trust.

Yeah, very good, very good. Then it's literally a tool in the toolkit. It's just. Okay, it's time for the land trust. Go get the toolkit. All right. A couple questions you also open up is you mentioned the use of LLCs and there are certain states that get recommended where to open up. You know where to form your LLC in certain states with land trust. Is there the same kind of scenario? Is the state important where, quote, the land, the trust is formed? Talk about that.

Yeah. What's really cool about that, Lance, is there's no federal land trust law. It's all state by state and all states recognize the validity of these trusts. Some states are a little more problematic because they're not familiar with them and you may not be able to get like title insurance, for example. But to, to give you an example, I live in Illinois. All my investment property is in Illinois, but I don't use Illinois land trust. There are only six states that actually have a land trust statute. And, and in my opinion, some states have better trust laws than others. So people that become my student, I tell them, you know what, you know, here's the best state to form your trust in, no matter what state you live in or no matter what state your, your property is in. So Yeah, I definitely have some strong opinions on which state you should form your trust in. And while we're on that subject, that doesn't mean you got to travel to California, for example, and form a trust out there and come back home. You can form your trust in another state right in your family room or your office at work.

All right, all right. So you have, I guess I'll call them land trust friendly states is a way to think of it. Is that exactly the case law? That's fortunate. All right, all right. So we've had, you know, there's been a lot of conversation recently, Mr. Land Trust about the Corporate Transparency Act. Matter of fact, you know, all my entities do the stuff there. So with the Corporate Transparency act, how does that affect land trust? You have to register them as you do an llc. What's no ruling there.

You do not have to register a land trust. And I'm still trying to figure all this out because it's like a moving target. I personally haven't registered anything yet because there are several lawsuits out there that are yet to be determined. And I'm hoping and praying that the whole damn thing gets ruled unconstitutional, as it did in the case down in Alabama recently. But basically, the land trust does not have to register under, under that Corporate Transparency Act. But for example, theoretically, the government is looking for, like drug dealers that are buying real estate for $10 million in cash and as a store of value to hide the money, you know. So as I understand the act right now, if I had a land trust that owned a piece of real estate and I sold you the beneficial interest in the trust, Lance, for all cash, million dollars or whatever it is. But if it's an all cash transaction, I would have to report that to the feds. If, if it was a finance transaction, I would not have to report it because the theory goes that the bank that's financing reports all that information to the Feds anyway. So there's no sense in double reporting. So bottom line is we're still trying to analyze and see where we're at on that. But I personally think this makes these land trusts even more valuable than they were before. Because, you know, even before, if you formed a LLC for privacy and you did it in one of those other states, at least you had some privacy. But now you won't even have that, you know, because even the LLC is formed in those privacy states are going to have to report to the Feds, and I don't trust the Fed's one iota that that information is going to Be held confidential.

Right, right, right. But you said something that's interesting is that I'm going to kind of point this out to everybody is you could have a land trust on your property and you want to sell it. You could sell it. You're selling your who the benefit, their beneficial interest. Right. And so do you go through a title company in that type of transaction?

No, no, that is a totally private transaction. And it's interesting you bring that up. I've discovered in my business, Lance, that there are a whole lot of people in America that will never qualify for a conventional loan. The credit score is too low, they're in the cash business, they don't have Social Security number, the debt to income is off. All kinds of reasons why they will never ever qualify. But they want to buy a house, so why shouldn't I be the bank? I mean, isn't that how banks got rich? Loaning money to people? So I like to buy a house, close on my purchase at 9 o' clock in the morning and sell it at 3 o' clock in the afternoon and have the whole deal prearranged. And that's a great way to make money in this business. But there is a big risk, just like banks fear. And that is what happens if the buyer stops making payments. Well, I don't sell the buyer real estate. I sell them personal property. Trust personal property, which is the beneficial interest in the trust. It's not real estate, it's personal property. So if the buyer defaults, I repossess that interest, which takes me 30 days. And I can do it myself. And instead of. Well, in my town, if you don't do it, use this technique and you gotta foreclose. It's about 10 grand in legal fees and about a year to get your property back. That's pretty risky. So I love selling the beneficial interest in a trust on an installment contract.

Very smart. That's very smart. Very smart. Because you're going to repossess if they default, not foreclose.

Exactly.

That's very smart. All right, well, Randy, you've got a book you want to give and I want you to talk about that. The book is called Reasons to use a land Trust. And you also have a home study course you've mentioned a couple of times here. What's the distinction between the two?

Okay, well, the booklet I'm giving out for free is I get asked a lot of the same questions over and over again as I travel around speaking. And so I just put together a booklet with over 50 reasons to use These trusts. So I give that out for free just to get people interested in, get them thinking about all the different ways of using these trusts. And then if they want to go to the next level and learn how to do it, they can go to my website, which is Land Trusts made simple dot com. That's Land Trust with the, with the S trust. T R U S T S made simple dot com. There it is in the chat box. And, and they can get my home study course. I've got a basic home study course and an advanced course. The advanced course gets into teaching you a lot of new asset protection techniques using the trust. And it teaches you how to create a personal property trust. So if you want to put your car, your boat, your motorcycle, your shotgun, your hammer, anything you're going to loan your neighbor and he's going to hurt himself with and sue you, you need to put the personal property in a personal property trust. And that's different than a land trust. Land trusts are for real estate, not personal property. So there's a lot of free information on that website. A lot of free information, answer a lot of your questions. And my phone number is on there, believe it or not, I answer my own phone. I mean, who in the heck does that? From 8am to 8pm seven days a week, I answer my own phone. So if you have any questions after reading this material, feel free to pick up the phone and call me. If you'd rather email me, it is randy@misterlandtrust.net. there's my email address.

All right, so let me. Of course, we'll put all this on the show Notes for everybody. But let me get this out again. So first of all, there's for his free book, Reasons to Use a land trust. 50 reasons why to Use a Land Trust. This is for free. Go to the show notes. There'll be a link there. You can download, download that book. Download that book. If you want to get in contact with Randy, you want to go engage in doing this yourself through his home study systems. Then you've got a couple places. Landtrustmadesimple.com that's trust with an S. It's plural. Land Trust made simple.com or you can email Randy at mrlandtrust.net randy@mrlandtrust.net and he also put his phone number on there, which I'm not sure I would have done that, Randy. But there's, there's the man, Mr. Land Trust. And you can tell he's a very generous with the information, with what he's offering. You get for first get, get it. Make sure you get the reason you the land trust so you can check out 50 Reasons and then get involved. Get the home study system at again land trustmadesimple.com Mr. Land Trust, this has been, this has been really good. Is what question have I not asked that I should have asked with regards to the use of land trust? Is there a certain application or a certain, I don't know, you decide. But what's one thing you want to leave people with.

Sometimes? I get the question. You know, Randy, you tell us all this great, these great things about land trusts. What, what is bad about a land trust? And I think that's what you're alluding to. And really the only negative I've found in using these trusts for the last 40 some years in my business is that it is extra paperwork. You do have to be organized and form the trust before you buy the property because the smartest way to buy real estate is to take title directly from the seller to your trust. So you're never in that chain of title. So you do have to have find a trustee, print out and fill, fill out your trust agreement and the trustee signs it, and you sign it and be prepared to close your deal. So to me, that's the biggest negative is you got to be organized and you got to do this in advance. But you know, the way I look at that, Lance, is what's your net worth? Worth? Is it worth a little extra paperwork? I mean, come on now, you know, you spend all this time building wealth and you, you don't want to spend, you know, 30 minutes putting together a trust or five minutes putting together a trust. So. But that, that's the, the only negative I've run into in using these trusts.

Well, I think I, I 100 agree with that. I think, I think being there's a, there's a, one of the ways you create wealth is by being organized, being ready to go, being ready to pull the trigger. So might as well be organized with your, with your land trust, have that document ready. And it's. We're not talking about rocket science here, guys. I mean, literally the webpage is Land Trust made Simple. I mean, hope you're getting that. Certainly getting that coming through here. This is, this is simple. This is simple. This is not the LLC process. This is a land trust. It's much, much, much, much simpler.

Right?

So everybody, thank you, thank you for this today for everyone. Let me repeat back these resources he's making available to you. The free book reasons to use the land Trust over 50 reasons he's compiled over all the years so you can capture it all in one place in the book that's for free on the show notes in the show notes are going to be at my page called greenlight re investing.com greenlight re reinvesting.com there'll be the show notes here and all the recording. Then if you want to get involved with Randy more directly as Mr. Land Trust on his home study system or question maybe you have about application to your situation actually gave you his email randyrlandtrust.net, randyrlandtrust.net, plus he had his phone number on his page. Please make sure you have a real question if you're calling him a phone number because he but you can see very generous for the information. Very generous information. Mr. Lantrust, this has been fantastic. I want to thank you for all the just sharing the wealth and the generosity and sharing it today. Thank you so much.

Thank you, Lance. I appreciate the opportunity. It's been a lot of fun as always.

As always. So for everyone, look forward to our next session. Again for the show notes go to greenlight reinvesting.com until the next session. Go take what you learned here. Make yourself a successful real estate lifestyle. Take care everybody. Bye bye.

You've been listening to Interview with the Experts with Lance Edwards. Let us now blatantly and shamelessly bribe you toward creating your own real estate lifestyle by offering you a whole bunch of free stuff. Go to greenlight reinvesting.com and get you some free, free stuff. And this session show notes, that's greenlightreinvesting. Com.