why would i do a title holding trust when i can set-up a normal living trust and just name the living trust something different?

renewbie:

why would i do a title holding trust when i can set-up a normal living trust and just name the living trust something different?

Hi renewbie,

It depends on what your objective is.  Are you setting up the trust for privacy or confidentiality of ownership?  I'm assuming that you are since you indicate you are considering setting up a living trust and just naming it something different.  The recorded deed into the living trust would show the name of the trustee or trustees, which would generally be you and/or your spouse, and would therefore still put your names on the public record.  The Title Holding Trust uses a third party (Exeter Fiduciary Services, LLC) as an independent private fiduciary to serve as Trustee of the Title Holding Trust so that your names would not show on the public record and your ownership of the property would remain confidential and private.

Also, the Title Holding Trust allows multiple beneficiaries and can protect the beneficiaries from liens or judgments that are levied against only one of the beneficiaries.  Any lien or judgment can only attach to the beneficiary's interest in the trust.  It can not attach to the real estate itself because the beneficiary does not own the real property; the Trustee does.  The beneficiary owns an interest in the trust. 

The Title Holding Trust can also name your current living trust as the beneficiary so that it fits into your existing estate planning very nicely. 

I keep my properties in a delaware llc.  I named the llc so it does not have my name on title.  Wouldn't that be better than your trust? 

No, not necessarily.  It really depends on your goals and objectives.  There is no one size fits all solution.  You need to look at your financial goals, your estate plan and any existing trust(s) that you have in place, asset/liability/risk management needs, etc.  The limited liability company will generally protect you from liability. 

However, it is not a trust and it will not provide complete confidentiality and privacy of ownership.  The Title Holding Trust or California Land Trust is a fully revocable grantor trust that will bypass probate upon death.  The limited liability can not do that.  There are ways to find out who owns the limited liability company.  It is as simple as going to the Secretary of State's office and looking up the registered officers and members (owners) in some states.  The Title Holding Trust is never registered or filed with any public agency or recorded through any public records. 

Those investors that are concerned about confidentiality and privacy issues as well as risk and liability issues may want to have the real estate owned directly by a Title Holding Trust and the sole beneficiary (owner) of the Title Holding Trust could be another entity such as a limited liability company.  This way the Title Holding Trust can provide confidentiality and privacy of ownership while the limited liability company can protect you from liability.