How do I get financing if all my prop.are in trusts?

I want to place my properties in a trust in which I have not a CLUE what the terminology means except that a beneficiary recieves , a trustee is the one that "owns"the property/trust? I want to do this for assisted security measure should there ever be a law suit.I know nothing protects you 100% but everylittle bit helps.Here is the dilema.If I place the property in a trust I no longer own them but I will still show ie:$1,000,000 in mortgatge payments?who in their right lending mind would lend someone money who owns nothing and owes $1,000,000 ? How does placing prop. into a trust effect future funding?

Just take the property out of the trust long enough to finance the property and then put it back in.

Another solution is using a long term NNN lease to show the lenders a no BS justification for allowing 100% crediting of your incoming rent payments, rather than they typical 70%


Triple Net Leases can be ideal for commercial real estate, but they are not always appropriate or enforceable for residential real estate. Many states (including Ohio) have specific laws that make the landlord specifically responsible for certain items such as maintenance. Putting the maintenance on the tenant is in violation of the specific tenant landlord law and I don’t believe the lease would be enforceable in court.

The law has different standards for residential and commercial leases. Residential tenants are considered more vulnerable than commercial tenants and are therefore afforded more protection under the law.


By using a NNN residential lease, a landlord may pass on active tax deductions associated with IRC 163. The qualifier is …must be the tax payer’s principal, private residence and the financing arrangement must entail the full risks and burdens of ownership…
In a well constructed tlease/option type of arrangement, it could be argued there is no “tenant” per se, only a “financing arrangement entailing the full risks and burdens associated with ownership” so the NNN lease would be in complete accordance with existing law.

The lease would be but what about the laws of respa?

RESPA? In what context would they apply? There’s no close…


I wasn’t thinking about tax issues, I’m talking about tenant-landlord law. In other words, even if you sign a NNN lease with a residential tenant, when something big breaks - you’d still have to fix it under the law. That is specifically required in Ohio. So, while you would probably get lower rent based on the NNN lease, you’d also end up paying for the big maintenance as it is required by the law. Professional tenants know this!


This was why I said respa? you are financing this prop so to speak.I have never heard of a triple net lease for residential ,so in an area where it is not recognized I would probably be looked at as a thief.How do you suggest avoiding this.According to Daves last post it doesnt even sond profitable to have tripple net lease.

I know absolutely nothing about tenant-landlord law in Ohio nor your particular business model. I use trusts to acquire sub-2, with the “tenant” having a nominal beneficial interest. Because of his beneneficial interest, he has is no longer a tenant, but one of the “owners” and the only owner who may take the active deductions. Because they are now the owner and have gained all the tax deductions associated with “the risks and burdens of ownership…” I am able to charge higher rents, still relieving myself of maintenance responsibilities. It might not work within the structure of your business model, but it does in mine. In my scenario, the “tenant” is the landlord, renting from himself on a NNN basis. When screening applicants, I look for people who truly want to own, not professional tenants.
Of course, there’s a landlord policy on the dwelling.
There’s more to it, but this is the short version.

Are you trying to sell this house to the tenant or simple have a fee simple tenant.?

Maybe the tenant doesn’t want to eventually own but can use the tax deductions, doesn’t matter. He wouldn’t be a fee simple tenant, though.