EQUITY HOLDER LAND TRUST BUSINESS METHOD

• US 20090018941A1
• Filed: 06/20/2008
• Published: 01/15/2009
• Est. Priority Date: 06/22/2007
• Status: Abandoned Application

• Current Assignee: Bill J. Gatten
• Original Assignee: Bill J. Gatten
• Inventors: Gatten, Bill J.
• Application Number:
  US12/142,941
• Publication Number:
  US 20090018941A1
• Time in Patent Office: Days
• US Class Current: 705/35
• CPC Class Codes: G06Q 30/02 Marketing; Price estimation or determination; Fundraising
• CPC Class Codes: G06Q 40/00 Finance; Insurance; Tax strategies; Processing of corporate or income taxes

Abstract

A method for transferring real property ownership includes locating real property having an identified owner. A non exclusive purchase option is prepared to acquire interest in a land trust associated with the real property when predetermined conditions are satisfied. An offer is presented to the owner including an agreement for an investor to assume responsibility for the real property, and the purchase option for the real property in exchange for the owner establishing a revocable inter-vivos land trust associated with the real property and naming the investor as a remainder agent and co-beneficiary to the trust. A qualified independent 3^rd party that meets the not-for-profit requirements of U.S. Internal Revenue Code 26 U.S.C. § 501(c) is nominated as a trustee of the trust. A limited and revocable power of attorney is executed that gives the investor co-beneficiary limited power over property management for the real property.

Claims

1. A method for transferring real property ownership, comprising:

a) locating real property having an identified owner;

b) preparing a non exclusive purchase option to acquire interest in a land trust associated with the real property when predetermined conditions are satisfied;

c) presenting an offer to the owner, the offer including;

i) an agreement for an investor to assume responsibility for the real property and improvements on the real property; and

ii) the purchase option for the real property if the owner will establish a revocable inter-vivos land trust associated with the real property and naming the investor as a co-beneficiary to the trust;

d) nominating a qualified not-for-profit organization as trustee of the trust; and

e) executing a limited and revocable power of attorney giving the investor co-beneficiary limited power over matters of property management for the real property.

2. The method of claim 1, wherein the qualified not-for-profit organization meets the requirements of United States Internal Revenue Code 26 U.S.C. §

501(c) for tax exempt status.

3. The method of claim 1, further comprising:

a) executing an agreement for use and possession between the trust and the investor co-beneficiary to enable the investor co-beneficiary to claim tax benefits associated with the property to the investor co-beneficiary.

4. The method of claim 1, further comprising:

a) exercising tax incentives and benefits by all co-beneficiaries according to the share of beneficial interest each co-beneficiary holds in the real property.

5. The method of claim 1, further comprising:

a) recording the purchase option, certification of trustee, and power of attorney with an appropriate government representative.

6. The method of claim 1, further comprising:

a) executing a notification of uninsured deed.

7. The method of claim 1, wherein execution of the trust further includes assigning a relatively larger percentage of the beneficial interest in the property to the investor, and a relatively smaller percentage of the beneficial interest to the owner.

8. The method of claim 1, wherein execution of the trust further includes assigning approximately 50% of the beneficial interest in the property to the investor, and approximately 50% of the beneficial interest to the owner.

9. The method of claim 1, wherein the trust includes provisions that facilitate a transaction selected from the group consisting of a lease option, a lease purchase, an all inclusive trust deed, an equity share arrangement, a land contract, a contract for sale, a contract for deed, a contract for warranty deed, and combinations thereof.

10. The method of claim 1, further comprising advertising the real property and trust benefits to find a resident co-beneficiary.

12. The method of claim 1, wherein the trustee is granted the rights to title to deal with matters of title on behalf of the beneficiaries of any unpaid monies owned by the beneficiaries of the trust.

13. The method of claim 1, wherein the identified owner is a motivated seller who is willing to leave the seller'"'"'s existing mortgage financing in place along with some or all of the property'"'"'s existing equity until the land trust terminates.

14. The method of claim 1, wherein the non-exclusive purchase option is a short term purchase option having a term of between 30 and 60 days and has the option of being cancelled at any time by either party with between 5 and 10 days notice.

15. The method of claim 1, further comprising:

a) using the beneficial and co-beneficial interests in the land trust as security in a loan transaction; and

b) repossessing the beneficial interest within approximately thirty days.

11. The method of 10, further comprising:

a) negotiating a purchase agreement between the investor co-beneficiary and the resident co-beneficiary such that the predetermined conditions of the non-exclusive purchase option are met; and

b) executing the non-exclusive purchase option to transfer the title of the real property from the owner to the resident co-beneficiary.

16. A method for transferring real property ownership, comprising:

a) locating real property having an identified to an owner;

b) preparing a non exclusive purchase option to acquire interest in a land trust associate with the real property when predetermined conditions are satisfied;

c) presenting an offer to the owner, the offer including;

i) an agreement for an investor to assume responsibility for the real property and improvements on the real property; and

ii) the purchase option for the real property if the owner will establish a revocable inter-vivos land trust associated with the real property and naming the third party as a co-beneficiary to the trust;

d) nominating a not-for-profit organization meeting the requirements of United States Internal Revenue Code 26 U.S.C. §

501(c) for tax exempt status as trustee of the trust; and

e) executing a limited and revocable power of attorney giving the investor co-beneficiary limited power over matters of property management for the real property;

f) negotiating a purchase agreement between the investor co-beneficiary and an acquiring party such that the predetermined conditions of the non-exclusive purchase option are met; and

g) executing the non-exclusive purchase option to transfer the real property from the owner to the acquiring party.

17. The method of claim 16, wherein the investor co-beneficiary is an investment entity selected from the group consisting of a real estate investment group, an individual, a corporation, and combinations thereof.

18. The method of claim 17, further comprising advertising the real property and trust benefits to find a resident co-beneficiary.

19. The method of claim 18, further comprising:

a) negotiating a purchase agreement between the investor co-beneficiary and the resident co-beneficiary such that the predetermined conditions of the non-exclusive purchase option are met; and

b) executing the non-exclusive purchase option to transfer the title of the real property from the owner to the resident co-beneficiary.

20. A method for transferring real property ownership, comprising:

a) locating real property under obligation to an owner;

b) preparing a non exclusive purchase option to acquire interest in a land trust funded by the real property when predetermined conditions are satisfied;

c) presenting an offer to the owner, the offer including;

i) an agreement for an investor to assume responsibility for the real property and improvements on the real property; and

ii) the purchase option for the real property if the owner will establish a revocable inter-vivos land trust associated with the real property and naming the investor as a co-beneficiary to the trust;

d) nominating a not-for-profit organization meeting the requirements of United States Internal Revenue Code 26 U.S.C. §

501(c) for tax exempt status as trustee of the trust; and

e) executing a limited and revocable power of attorney giving the investor co-beneficiary limited power over matters of property management for the real property.

f) advertising the real property and trust benefits to find a resident co-beneficiary;

g) executing an agreement for use and possession between the trustee and the resident co-beneficiary to allow the resident co-beneficiary to claim tax benefits on the real property.

21. The method of claim 20, further comprising:

a) negotiating a purchase agreement between the investor co-beneficiary and the resident co-beneficiary such that the predetermined conditions of the non-exclusive purchase option are met; and

b) executing the non-exclusive purchase option to transfer the title of the real property from the owner to the resident co-beneficiary.

22. The method of claim 20, further comprising:

a) accepting a default in lease payments by the resident co-beneficiary as constructive notice of the defaulting beneficiary'"'"'s intent to sell the defaulting beneficiaries interest in the trust for full fair market value to the non-defaulting beneficiaries;

b) determining full fair market value by authorized appraisal; and

c) facilitating an offer by the non-defaulting parties to the defaulting party to purchase the defaulting parties beneficial interest in the trust.

23. The method of claim 22, further comprising:

a) facilitating payment of the difference between the full fair market value and the offer of the non-defaulting parties in the form of an unsecured promissory note set to be honored in full at or before the scheduled trust termination date provided sufficient funds are derived from any sale of the real property at the termination date.

24. The method of claim 20, further comprising:

a) recording the purchase option, certification of trustee, and power of attorney with an appropriate government representative.