Home › Forums › General › EHTrust/EHT Topics and Creative Real Estate Financing › land trusts deceptive to hide from the DOS
August 6, 2008 at 6:56 pm #5033
tax attorney’s opinion on why land trusts does not give asset protection. also mentions why he thinks land trusts are deceptive to conceal the DOS.
1 hours and 30 minute audio file. thought this may be a good discussion.
[audio src="http://reiclub.com/authors/hyre/reiclub101106.mp3" /]August 6, 2008 at 7:58 pm #26639
How is it deceptive if the US Government made the law. Plus using a properly created Land Trust does not eliminate the Lender from calling the note due for “cause”, such as non-payment etc. It does not allow them to call the note due just because you named someone a beneficiary of YOUR Trust. Even the IRS treats the beneficiaries as “owners” of the property for tax purposes.
This Attorney has his head up his A$$.August 6, 2008 at 8:57 pm #26640
40 minutes into the audio this is when he talks about land trusts.August 6, 2008 at 10:19 pm #26641
Hi Alvin -
I appreciate your time and energy spent marketing, talking, writing and researching the equity holding title transfer transaction that we often refer to as the NEHTrust or Land Trust, in general. Thank you very much for all that you do for us here at NARS and for our Members and interested others both at our website and in direct contact.
I look very forward to the day when I generate signable Trust Docs for your first full NEHTrust transaction and forward those originals on to Thomas at EHC for you, secure in the knowledge that you will be well on your way to financial freedom. You know that I have even told you face-to-face that I will assist you in any manner that I have the ability to do to make this become a reality for you.
You may not be aware, but lots of folks around here are really rooting for you. That includes me.
So, with that as a context, please allow me to pose the following question:
Did you really spend 90 minutes or more listening to a nameless faceless tax attorney that you likely have never met to listen to him refute via his opinion that which you have personally heard Bill Gatten talk about, and quote from actual U.S Code and IRS Code at least a dozen times, or more?
Really?? 90 minutes?? Plus the time to listen to selected portions again? Plus the time to log on to our website to post for all of us to read, including newbies, that some tax attorney that none of us have ever met or heard of is going to change our beliefs about the Land Trust and refute what Bill has spent two decades researching? Plus the time it took to come up with a Title for this post that was sure to attract more attention than conversation? If I did not have the historical perspective of knowing you and your beliefs better, I would have thought, based solely on what you typed, that you actually agreed with the Tax Attorney.
Please tell me that you didn’t really spend your time in this manner.
I guess that I should thank you for posting another voice in the seemingly endless drone of those who still can’t quite wrap their heads around Bill’s simple concept. I would encourage you to consider the possibility that the next time you do post another Nay-Nay-Bird’s opinion, please do so understanding that this may not be perceived as “good discussion”. Bill has spent nearly 20 years (!) listening to people tell him their opinions about why one aspect or another of the transaction couldn’t possibly work in real life. In every case, he has researched and found THE LAW that actually supports his position.
Continue making Offers. Let’s get you that transaction and make you a few dollars along the way.August 6, 2008 at 10:39 pm #26642
Each time I, as settlor, have placed my own property in an EHT and gotten an RB, I have simply called the lender and notified them. No DOSC problem, ever. It’s really very simple.August 7, 2008 at 12:06 am #26643
i completely understand what youre saying. his opinion of land trusts never changed my mind nor my beliefs of what bill gatten has taught me. i do not agree with this tax attorney’s opinion of land trusts and bill’s method is the reason why i got off the fence to take action.
yes i was listening to his 90 minute discussion on asset protection while i was working. i wanted to hear what he said about land trusts so i know the BS he’s feeding people. other than that he talked about other topics in regards to LLC’s and taxes which was a another benefit to hear. basically he’s not a big fan of land trusts which i respect.
im all for EHT of course!August 7, 2008 at 12:24 am #26644
i just spoke to an litigation attorney last night who’s also a seller and he’s completely sold on the EHT in regards to how we’re able to offer so many benefits, protections and profit centers he never knew about. he has two properties that are overencumbered and completely understands the 90 day NEO that i sent him. he’s knows its a non binding agreement and that its risk free for both of us to market his property for any potential RBs.
he’s also amazed on why i would take on properties that have no equity and that are severely overencumbered. i simply told him nobody wants them and not too many people can do what we do and make profits out of them!
he literally asked me “how would other attorneys, doctors or other high net professionals would know about this secret?”
i honestly told him ive never really had the chance to market to these people. i would either meet them by accident or by word of mouth.August 8, 2008 at 4:07 pm #26645
Alvin you have entirely too much time on your hands. You are a great young fellow and you will go far. Keep your focus my friend. Stay focused on making offers and finding RB’s. Nothing else is needed. Trust me I know this from experience I am a computer guy too.August 8, 2008 at 4:55 pm #26646
this topic helped me find the free ebook picking up preforeclosures, so thanks alvin for presenting this idea, i would have never guessed the site you pulled it from has free information like that. i just used their forums and never really perused around.August 12, 2008 at 2:37 am #26647
Each time I, as settlor, have placed my own property in an EHT and gotten an RB, I have simply called the lender and notified them. No DOSC problem, ever. It’s really very simple.
Hi Gary, I know this is probably good to do but what do you say or not say when you contact the lender? do you expect to recieve a confirmation that you did it and when exactly in the process do you try to make that happen? Is this the information release form in the proposal documents that you are contacting them with? Also thank you so much for your informative answers I am close to doing my first Pactrust Agreements on a few of my own properties and hopefully it mushrooms from here on out. …JonAugust 16, 2008 at 1:16 am #26648
I just tell them that I am setting up a trust for estate planning and asset protection purposes and that if they notice a change of title, don’t be alarmed. I am simply exercising my right to do so under Garn-St. Germain. Only once did I run into resistance. The loan officer at Countrywide told me he would have to check with his legal dept. When he failed to call back, I called him and he reluctantly admitted that they had confirmed what I had said. It’s nice to have the law on our side.August 16, 2008 at 1:55 pm #26649
Each time I, as settlor, have placed my own property in an EHT and gotten an RB, I have simply called the lender and notified them.
do you recommend SB’s to contact their lender to notify them or let them find out through the change of insurance. I have owners placed their property into a simple trust and place my company as additionally insured and never hear from the lender. Is that dangerous or did you think its an ok practice?
I use trust for deals with plenty of equity, but not with marginal deals. Here, you have to go through individual insurance companys for hazard insurance on trust, which is more expensive than regular landlord insurance, which eats into our cashflow.August 16, 2008 at 2:13 pm #26650
I’ve always notified them myself. Just my personal preference.August 22, 2008 at 8:27 pm #26651
I have not listened to the whole presentation–just the land trust part; however, I am not at all surprised that Mr. Hyre would attempt to play down the value of land trusts.
The guy, a bright and otherwise competent attorney, has publicly indicated on at least one discussion group, and personally to several fairly prominent people in this business, that he just doesn’t like me. And that is of course is his prerogative (most of my in-laws, rental tenants, illegal aliens and Democrats don’t like me either). Though I do have to admire a guy who says what he thinks irrespective of the deleterious effect it might have on others.
As I always say (OK, well, I say it often…ok then, once in a while): “When one makes his living by the ‘old’ way, the new way always has a difficult time getting through the bony barrier of the skull, much less the anterior median fissure of the medulla oblongata.”
It’s interesting to note that in John’s presentation (unless I didn’t listen long enough), he never mentions multiple-beneficiary, 3rd-party trustee land trusts, which I loudly and unabashedly DO DECLARE protect their res (the property) due to specific laws that oppose partition and charging re. co-owned personalty. In fact, there has never been a single failure in that assertion that I know of, and certainly never a failure with regard to the thousands of EHT Transfer System(tm)(r) transactions that we’ve completed. I have been privy to lots of attempts to thwart our system (lawsuits and hearings re. the co-beneficiary, 3rd party trustee land trust transfer) and quite candidly they jist ain’t been none that have suck seeded.
A few years back, John and his attorney friend, Bill Bronchik, jointly predicted that what I teach is merely a ‘house of cards’ that would soon come tumbling down. Well, that was about ten or eleven years ago and the only thing that’s come tumbling down is the the banking industry, the economy, the real estate market and lots of money for our students’ pocket books. Our program is still hanging in there and becoming more and more popular and functional every day. For an increasing numbr of people, it’s providing the only way out of this banking melt-down.
Re. the DOSC issue…there simply is no bank in the country that (any longer) would consider a transfer to a land trust a DOSC violation, so long as the borrower of record remained a beneficiary, and the trust did not transfer occupancy rights (a separate lease, without an option, for under 3 years can do that however). And, of course, the appointment of a remainder agent or co-beneficiary is a natural function within any trust.
In John’s talk he claims the land trust has very few benefits, then goes on to name a bunch of them: avoidance of probate, avoidance of transfer tax, privacy and anonymity of ownership, etc. (and he missed avoidance of Ancillary Administration upon death of a beneficiary, avoidance of Continuity of Transfer issues with 1031 exchanges, which is a problem for LLCs), not to mention ease of transfer and the protection of one’s public declaration of the acquisition price (re. comps) when acquiring beneficiary interest, or the non-necessity of showing an income property inventory when qualifying for mortage loans on other properties).
He does claim that a land trust is a weak means for avoiding a due-on sale clause…and I agree whole-heartedly! However, it only does so when the borrower of record gives away ALL of its beneficiary interest and control over the property…the lender’s security.
If John does (…and he may not), as do many attorneys, think Title 12 of the CFR (591vi) would challenge our claims, it’s important to know that title 12 of the CFR is not, and has never been, enacted as law. The law is found in Title 12, of the U.S. Code Sec. 1701-j-3, not the CFR (…see Title 1 of the CFR for excluded codes: one of which is Title 12).
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