cash out in land trust

[Meiching Chou]

I purchased a REO house using 100% cash. Knowing the benefit of anonymity from your classes, I set up a land trust to be the owner in warranty deed and assigned my LLC as the beneficiary.

I plan to use the property as a rental for the next few years. How do I refinance to get my cash out to acquire more properties without destroying the anonymity? I was told by several lenders that no lending is possible for a property owned by a land trust.

I plan to deed the house back to myself from the trust, which will inevitably destroy the anonymity. Then, after some seasoning period (6 months?), I will get the cash out refinance to get the equity out to acquire more properties. Finally, I will deed this house to my LLC or trust for rental asset protection.

Is this the correct way to get cash out, or are there other ways to get the cash out in a timelier manner?

[George Roddy, Jr.]

Meiching,

Good question. In my opinion, the only way to get a loan is to deed the house to yourself, get the loan, then deed the house back to your trust. You are correct, lender's won't loan to a Trust. You lose the anonymity but you gain the cash to desperately seek. Most investors that are using our Trust are using it to take title 'subject to' the existing debt when buying a piece of real estate.

I have a suggestion, talk to your local banker. I have business line of credit that I have gotten and put up some of my free and clear assets as collateral.

I hope this helps.

Good Luck,


George Roddy, Jr.
CEO/Partner/Investor

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[Sondra Vanhavryk]

If you deed the property to that of your LLC, will lenders then make the loan to the LLC or do you have to have your personal name on the loan? If they lend to an LLC, then I would think that you would at least have some asset protection during the seasoning period.