Home Asset Protection

Securing home asset protection is a priority in an unstable economy. With foreclosures and unemployment in the U.S. running an all time high, property owners are concerned about keeping their homes in the event of lawsuits, tax liens, or judgments. Aside from being faced with bankruptcy, IRS liens, or exorbitant settlements, homeowners should not have to be worried about selling their house to satisfy creditors. But there are legal means of keeping the homestead, even when money, credit, and second mortgages are scarce. One strategy, placing property in a land trust, is a legal proceeding which ensures that homeowners won't be left out in the cold. A land trust puts the title to real property in another person's name, usually a trustee, and frees the homeowner from legal repercussions, such as tax liens or judgments. The owner retains all rights of ownership, including the right to occupy or rent the home, file a homestead exemption, or apply for an installment or home improvement loan. In other words, the benefits of ownership do not change; but home asset protection safeguards property and possessions.

We live in a society where anyone is subject to be sued at any time and for any reason, especially entrepreneurs. While individuals and business owners can expect to battle lawsuits at least once in a lifetime, there is no reason why personal property should be lost in the process. Individuals may spend years accumulating possessions or building a family home, only to have the courts foreclose or repossess a lifetime of memories, which can never be replaced. In the case of court-ordered judgments against a defendant, the authorities may be given the right to enter a home and seize contents as restitution for unpaid accounts. The local sheriff meets the creditor at the debtor's home and begins to go through room by room, allowing creditors to take whatever they deem necessary to satisfy the judgment. Furnishings, computers, electronics, or vehicles --whatever items total the amount of money owed are immediately forfeited. While filing a homestead exemption prior to a judgment being rendered prevents authorities from taking certain personal items and real property; home asset protection via a land trust, family partnership, or by transferring title are some of the most affordable and effective ways to protect property. And these legal means are not just for the rich and famous.

Wealthy property owners and entrepreneurs have long utilized systems for sheltering possessions to avoid paying excessive taxes or incurring liability. Placing property in the name of children or spouses, establishing offshore enterprises, or forming limited liability corporations, LLCs, are several ways the wealthy routinely hide assets. But similar home asset protection options are available for average income individuals and families. Lawyers can help families form partnerships or LLCs for tax savings; place residences in a land trust; or form a living trust to ensure that assets are available when needed, not just upon the death of the head of household. Homeowners can avoid running the risk of losing savings or selling the house to pay judgments or excessive taxes. Heir property stays in tact without local, state, or federal seizure; and survivors can benefit from property that can easily be transferred without incurring hefty fees or tax levies. Unlike a brick and mortar structure, our heavenly "house" is one that can never undergo foreclosure: "For we know that if our earthly house of this tabernacle were dissolved, we have a building of God, an house not made with hands, eternal in the heavens" (II Corinthians 5:1).

Individuals interested in home asset protection should seek legal counsel before getting served with a lawsuit or judgment. Once litigation has begun, it is really too late to put an effective plan in place. Lawyers who are adept at estate planning or professional real estate brokers can advise clients as to how real property and possessions can best be protected. Even if creditors are successful in winning judgments; or even if the federal or state government has a legitimate case for collecting back taxes, homeowners can rest assured that they won't have to sell or move out of the residence to satisfy creditors. Legal counselors will provide several options for home asset protection, including placing the property in a land trust, forming a limited liability corporation consisting of family members (in which case all assets become the property of the corporation), or forming and transferring assets under another business or named individual, also known as a trustee.

While there are online companies which advertise do-it-yourself home asset protection, individuals may want to have attorneys review paperwork to ensure that plans are properly structured and ownership remains secure. Laws may vary according to an individual's state of residence, age or annual net income. Business owners who are faced with closures due to failing sales, Chapter 11 bankruptcy, or a lack of bank funding may seriously consider home asset protection to retain ownership of personal property. In the case of a Chapter 11 filing, court-appointed trustees oversee the liquidation of corporate assets, and creditors step in to help manage a failing enterprise. In that case, business property would fall under the jurisdiction of the court and new managers. But no one wants to lose a business and become bereft of personal property at the same time. For this reason alone, sole proprietors, partnerships and small business owners should take a good hard look at asset protection. There is not much anyone can do about a failing national economy. However by utilizing legal means of protecting prized possessions, especially real property, homeowners can at least hold onto a roof over their head, irreplaceable memories, and mementos of more prosperous times.

Total Asset Protection

The need for total asset protection is an important priority for many families and may be necessary due to a number of factors including medical expenses, lawsuits, and taxes. Working for a lifetime to obtain valuable assets only to see those assets eaten away can be very frustrating. Many property owners understandably wish to leave an estate behind for their children. But leaving these estates behind is becoming more and more difficult. People are living longer and incurring hefty health care expenses at the end of life. These expenses can completely obliterate an estate in a very short period of time. The need for trained financial professionals to provide advice and guidance for seekers of total asset protection is great. In an increasingly litigious society, anyone can fall victim to lawsuits that can strip them of valuable money and property. Many professions are more susceptible to lawsuits than others. For example, medical and legal professionals may face expensive lawsuits and desire to shelter their savings and belongings. Developing a solid total asset protection strategy is crucial for anyone who believes that their financial well being may be in danger.

Some of the tools that could be utilized may include wills, family trusts, limited liability companies, and limited partnerships. Since every circumstance is different, the skills of a legal or financial advisor are called for. This professional will be able to assess each client's unique situation and provide advice that will best fit the need of the individual client. Protection from lawsuits as well as strategies for limiting the amount of money that goes to pay taxes are some of the services that these professionals offer. Documentation preparation is another helpful service that will generally be offered. In addition, a good representative in total asset protection issues will also be able to explain what is happening to the client each step of the way. Fees for these services can vary, but could amount to hundreds of dollars per hour. But clients may feel that the money that is preserved through the efforts of a skilled professional more than earns such fees.

For many clients, it is not necessarily the just earnings that they have accumulated over a lifetime that are at stake. Frequently, total asset protection will include looking out for the earnings that clients are currently in the process of earning as well as any earnings that they will realize in the future. A successful lawsuit could not only wipe out assets that the client owns in the present, but could create a debt that the earner will have to pay on for years in the future. No one wants to be deprived of the opportunity to distribute their wealth in whatever way they see fit. Some families make the mistake of thinking that a sound will is all that is needed for total asset protection. In most cases, this is not true. An estate plan is important for anyone who wants to make sure that their belongings and earnings are handled in the way that they choose, both during the client's lifetime and after their death. There are a number of elements that will make up an effective estate plan. These elements may include a revocable living trust, a durable power of attorney for both finance and health care issues, and a living will.

A health care durable power of attorney, or POA, grants a person of the client's choosing the authority to make decisions regarding medical care. A separate document may be needed to grant authority to a chosen representative to make decisions in financial matters for the client. Living wills give the client the opportunity to explain ahead of time the kind of actions they wish to have taken regarding life support if such an unfortunate situation arises. If the only method of total asset protection that an individual has prepared is a basic will, a number of variables can impact whether or not the client's true wishes will be carried out upon their death. Heirs and others who believe that part of the estate belongs to them may contest the will, tying things up for many years. Taxes and court costs can eat away at an estate, eventually leaving less and less behind for those that the client wishes to benefit.

A major factor of total asset protection is a provision for the costs of long term care. Making adequate plans for the retirement years is incomplete if the possibility of spending the end of life in a long term care facility is not considered. These cost of such facilities can quickly topple an estate that clients have taken a lifetime to build up. Long term care insurance may be the answer if a family has had the forethought to purchase such a policy before the health of the individual has deteriorated to the point where such policies are not available. Even if it is possible to purchase long term care insurance, such policies can be very expensive. There are other options that are available to protect estates from the financial ravages of serious health care needs. Financial professionals can usually supply answers to families that are seeking to protect the estate of an aging loved one. The Bible records words of praise from those who have trusted God since they were young. "For thou art my hope, O Lord God: thou art my trust from my youth." (Psalm 71:5)

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