Asset Protection Archives - Norada Real Estate Investments

3 Business Structure Mistakes Real Estate Investors Make

December 24, 2018 by Marco Santarelli 9 Comments

Starting A Real Estate Investment LLC

Why have an LLC?

There are mainly two reasons why you want any kind of business structure:

Pay less tax, and protect your assets. LLCs can be especially helpful if there are multiple owners of a property. When you create an LLC, you’ll create an operating agreement that outlines the rights and responsibilities of each member of the LLC.

This can help you seamlessly manage your rental property business and also protect each member of the LLC in case of legal trouble.

Before you jump into creating your LLCs for your real estate holdings, there are a few things to consider. Do NOT make these three mistakes while creating an LLC for your real estate investment company.

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Urgent – New IRS Rules for LLCs and LPs

October 24, 2017 by Marco Santarelli Leave a Comment

The IRS has instituted new audit rules which require every LLC Operating Agreement and Limited Partnership (LP) Agreement to be amended. While we have never experienced such a dramatic requirement, it is important to make document amendments before December 31, 2017. The IRS likes to penalize non-compliance.

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Understanding Land Trusts (Part 4)

May 12, 2014 by Marco Santarelli 1 Comment

This article is Part 4 of a four-part series on Land Trusts. You can find Part 1 here: Understanding Land Trusts

In the previous installment of the Understanding Land Trusts series, we discussed the Due-on-Sale Clause and how the land trust benefits you. In this part we will discuss various strategies to keep your land trust involvement private.

Constructing a Land Trust for Privacy
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Due-on-Sale Clause – Understanding Land Trusts

April 1, 2014 by Marco Santarelli 10 Comments

This article is Part 3 of a four-part series on Land Trusts. You can find Part 1 here: Understanding Land Trusts

Now you may be asking — how is the land trust going to help me with my lender?

The answer lies in why the land trust was created, and why it’s perfectly legal. It’s basically a compromise between two opposing forces. On one side is the bank which is interested in generating income from loans and at the same time protecting itself through a security interest in real property — on the other side is the borrower (real property owner) who desires to transfer title to his property without fear of foreclosure or forced refinancing. The bank acts as the protagonist by incorporating a “due-on-sale clause” into most, if not all, mortgages its writes.

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Why Investors Use Land Trusts

October 12, 2013 by Marco Santarelli 5 Comments

This article is Part 2 of a four-part series on Land Trusts. You can find Part 1 here: Understanding Land Trusts

Investors, attorneys, or CPAs unfamiliar with the use of land trusts often ask me “why would someone consider using a land trust?” My general response is “why not.” When it comes to entity structuring many people prefer to being with the complex rather than the simple. The land trust, contrary to the multiple internet gurus or guest REIA speakers that sing the vestibule of virtues offered by this rudimentary of tools, is simply and nothing more than a title holding vehicle with some interesting attributes. From a legal standpoint, the land trust is a type of “grantor trust” (this is the phrase you should use in states that don’t formally recognize land trusts via statute).

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