What is a Land Trust?
How a Land Trust Works
A Land Trust is a simple method for handling various kinds of real estate (single family residences, apartment buildings, condominiums, commercial buildings, vacant land or farm land) located in the State of Illinois.
Under a Land Trust Agreement, the beneficiary retains complete control and benefits of the real estate. Additional property may be added, or the Trust may be terminated altogether if so desired.
Benefits of a Land Trust
A Land Trust provides the following advantages:
- Avoid probate expense and delay
- Succession of ownership
- Use of the beneficial interest as collateral
- Privacy of ownership
- Disposing of part interest
- Ease of transfer of ownership
- Quit-claim transfer out of joint tenancy
- Avoid liens upon your title
How You Can Create a Land Trust
A Land Trust can be created with a minimum amount of time and effort by signing a simple Trust Agreement naming Old Second National Bank as Trustee. That Agreement will provide that you, as owner of the beneficial interest, direct Old Second to hold title to the real estate on your behalf. You, as beneficiary, retain the right to the earnings, avails and proceeds of the property. You also retain the right to transfer full or partial ownership of, or to sell, the real estate. Sale is accomplished by providing to Trustee a signed Direction for Trustee’s Deed, together with a fully completed Trustee’s Deed.
The Agreement also sets forth the name of the individual (be it yourself or another person) given the power to direct Trustee to sign subsequent documents such as deeds, mortgages, leases and other related documents affecting the trust property. Old Second, as Trustee, will deal with the property only upon written direction of the party who has that power.
Following the creation of the Trust Agreement you must cause the subject real estate to be titled in the name of Old Second, as Trustee; this is done by Warranty Deed in Trust. After the deed is prepared and signed by you, it must be recorded in the County in which the property is located. After recording, the original deed should then be forwarded to Old Second, as Trustee, for safekeeping.
Your attorney will be able to answer your legal questions, and assist you in preparation of the Land Trust Agreement.
Additional information, including our current fee schedule, is available by contacting our Trust Services area at 630-906-2000.