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[ Follow Ups ] [ Post Followup ] [ The Forum Board ] [ FAQ ] But who is going to know??? Posted by jom-CA on August 20, 2003 at 9:20 AM In Reply to: Basic trust questions posted by Ward-CA- on August 20, 2003 at 8:29 AM : : Hello Ward : : I had a discussion with a fellow investor who has had trouble with the THT in the past. It seems not only does the seller get confused, so do certain title companies. OK, I realize that maybe this investor may NOT have done a good job of explaining given they are new to it but it seems to me this whole process can be a bit simpler. Just answer me this, Ward: Why can't you just set up the Trust Declaration like a normal "good ol'" Grantor trust? Another words, create a Trust that has the Investor (ie Buyer) as both the Grantor and the Beneficiary, and have someone (a friend or whatever) be the Trustee. Then when you buy the property from the Seller just have them grant the property DIRECTLY to this Trust. You don't even have to have the Seller involved with the Trust at all. You can still name it "Seller Family Trust" or whatever but there would be NO NEED to do the "Assignment of Beneficial Interest" at all. Title companies wouldn?t seem to have a problem, at least not anymore than they would with the ?Assignment? method. It just "looks" like a Living Trust. That is if they ever saw the Trust Declaration at all, which you really don't ever show them anway. Fast, clean, simple... : : I just don't see a need to do all that other ?assignment? stuff and you might even avoid confusing the seller. I mean, either way it "shields" the due on sale so what's the difference? To the outside world the Trust looks EXACLY THE SAME as your "assignment" method. : : What am I missing here? : : TIA Ward. : : jom : =-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-= : JOM, : Yes, you can have the seller deed her property directly to your trust. But that deed would not camouflage the sale, and as a consequence, you'd soon have a problem with the existing lenders and the enforcement of their "due-on-sale" clauses. : Since the homeowner wouldn't own your trust then the deed to you would have to show that a sale had taken place. That would require the payment of a transfer tax which would trigger a property tax reassessment. : So by having the title of the property transferred to the seller's trust then no formal sale has taken place and voila, you've avoided the problems of due-on-sale and a property tax reassessment. : Hope this helps. *************************** Hi Ward I don't see how this deed will be any different than the deed using the "assignment" method. You put the SAME info on the deed in BOTH cases. Plus, who is going to know who the GRANTOR/TRUSTOR of the trust is when you don't show them the Trust Declaration? You don't do that in either case so how would anyone know? You still don't pay the transfer tax so no reassessment. Same with the bank. I'm sorry Ward but I just don't see how to the outside world this looks any different than the usual assignment method. Thanks jom Follow Ups: I don't want to lie, especially when I don't have to... Ward-CA- 5:53 PM, 08/20/03 (1) Re: I don't want to lie, especially when I don't have to... jom-CA 7:25 PM, 08/20/03 (0) Post a Followup: Name : E-Mail : Subject : Comments: : : : Hello Ward : : : I had a discussion with a fellow investor who has had trouble with the THT in the past. It seems not only does the seller get confused, so do certain title companies. OK, I realize that maybe this investor may NOT have done a good job of explaining given they are new to it but it seems to me this whole process can be a bit simpler. Just answer me this, Ward: Why can't you just set up the Trust Declaration like a normal "good ol'" Grantor trust? Another words, create a Trust that has the Investor (ie Buyer) as both the Grantor and the Beneficiary, and have someone (a friend or whatever) be the Trustee. Then when you buy the property from the Seller just have them grant the property DIRECTLY to this Trust. You don't even have to have the Seller involved with the Trust at all. You can still name it "Seller Family Trust" or whatever but there would be NO NEED to do the "Assignment of Beneficial Interest" at all. Title companies wouldn?t seem to have a problem, at least not anymore than they would with the ?Assignment? method. It just "looks" like a Living Trust. That is if they ever saw the Trust Declaration at all, which you really don't ever show them anway. Fast, clean, simple... : : : I just don't see a need to do all that other ?assignment? stuff and you might even avoid confusing the seller. I mean, either way it "shields" the due on sale so what's the difference? To the outside world the Trust looks EXACLY THE SAME as your "assignment" method. : : : What am I missing here? : : : TIA Ward. : : : jom : : =-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-= : : JOM, : : Yes, you can have the seller deed her property directly to your trust. But that deed would not camouflage the sale, and as a consequence, you'd soon have a problem with the existing lenders and the enforcement of their "due-on-sale" clauses. : : Since the homeowner wouldn't own your trust then the deed to you would have to show that a sale had taken place. That would require the payment of a transfer tax which would trigger a property tax reassessment. : : So by having the title of the property transferred to the seller's trust then no formal sale has taken place and voila, you've avoided the problems of due-on-sale and a property tax reassessment. : : Hope this helps. : *************************** : Hi Ward : I don't see how this deed will be any different than the deed using the "assignment" method. : You put the SAME info on the deed in BOTH cases. Plus, who is going to know who the GRANTOR/TRUSTOR : of the trust is when you don't show them the Trust Declaration? You don't do that in either case so : how would anyone know? You still don't pay the transfer tax so no reassessment. Same with the bank. : I'm sorry Ward but I just don't see how to the outside world this looks any different than the usual : assignment method. : Thanks : jom Optional Link URL: Link Title: Optional Image URL: [ Follow Ups ] [ Post Followup ] [ The Forum Board ] [ FAQ ] WWWAdmin 2.0a © 1997 Matt Wright and DBasics Software Company, All Rights Reserved

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