Methods to Legally Protect Your Real Estate Assets
We spend most of our lives working hard to build our wealth. Real estate asset protection is one strategy that is aimed at protecting that wealth long term. Generally, real estate asset protection is a legal way to protect your assets from third party claims like creditors and individuals. This is very necessary for all businesses. With the right real estate asset protection in place, you are shielded from some of the most expensive risks such as creditor claims. View here some of the common methods to protect your real estate property.
Needless to say, insurance is one way to legally protect your real estate assets. The type of asset being protected will determine the insurance coverage you need. As you increase your wealth, it is necessary to increase your insurance coverage as well. Getting an umbrella policy is also advisable so as to get comprehensive coverage. Be sure to get professional guidance regarding the policy you will choose for your property.
Getting limited liability for your rental property is also very fundamental to real estate asset protection. By doing this, you ensure your personal assets do not suffer in the event of a lawsuit. Whatever issues your business might be having will not affect your personal property in any way. The business stands as a separate entity and as such debtors will not have access to your personal assets. Real estate asset protection can also be achieved by having your commercial assets in different LLCs. This will ensure that your assets will not suffer risks jointly.
You can also protect your assets through anonymous land trust. This is a good way to protect your property from legal implications. Having a trustee means your name will not be on any records. In the event of a lawsuit, the lawyers will not be able to trace your trust to your real estate properties. This method also serves to discourage people from pursuing lawsuits against you. Even before filing the suit, they will have to spend money on revealing your identity. The amount of compensation they are looking for might not be worth the lawsuit.
Another great real estate asset protection strategy is titling your home. Being equal tenants with your spouse means you both have indivisible interest in the property. This means creditors have no right to your home if either of you faces a lawsuit. You should keep in mind, however, that this indivisible interest can only be applied to your personal residence. For your commercial assets, you’ll need an investment property. Real estate asset protection is made possible with common tenancy.