When underwriting commercial title insurance, it’s not uncommon to encounter various types of trusts. One type of trust – the land trust – can cause issues if not dealt with properly. In this article, we are going to discuss how to deal with land trusts when underwriting title insurance.
What is a Land Trust?
A land trust operates differently than most other types of trusts. In a typical trust, a trustee controls and administers the assets in the trust. With a land trust, the trustee doesn’t have very much power. Rather, the beneficiaries of the land trust control the disposition of the trust assets. The land trust trustee must get permission from the beneficiaries before taking any action with the assets within the trust.
Land trusts are most common on the East Coast of the United States, but they’re actually illegal in some states (including Minnesota). That’s why these types of trusts can be particularly difficult to deal with. Many attorneys in different states aren’t aware that land trusts are illegal in Minnesota, so we have to work with all parties to make sure everything is above board. This is just one of many reasons why you should have a commercial title company review your transaction before closing on your property.
Contact a Commercial Title Company
Commercial Partners Title Company is recognized in Minnesota and across the United States as an expert in the field of commercial title insurance. If you are looking for help with your commercial real estate transaction, you’ve come to the right place. Our team of experts can walk you through the entire process and make sure you are ready to close on your property when the time comes. Reach out to us today at our main offices in Minneapolis to learn more about our services and how we can help!