Your lender will not allow you to get the loan in a trust so you must take out the loan as an individual. You then place the property into the land trust and your trustee takes title to the property.
The loan will appear on your credit report. I always have a tenant/beneficiary living in the house under a triple net lease. What we regularly do is get a letter from the Trustee to our new lender that indicates that we have the property in a triple net lease, hence no maintenance or vacancy concerns. The lender always gives full credit on the debt-to-income ratio and you are able to use this technique to own multiple homes.
Never make yourself a trustee – Risky and quite probable failure to honor privacy and anonymity, especially under threat of legal action.
An individual trustee’s failure to charge a fee would not support the land trust’s validity in court. The attempt to charge a fee would not be seen as adequate unless the party were a bonded entity.
If a trustee is also a beneficiary, a merger of title is created (see Doctrine of Merger), invalidating the trust if challenged in court as being a bona fide land trust.
An individual would most likely never be bondable as a trustee and would likely not have the resources to provide a completely separate, free and bonded collection and bill-paying service.
I have been reading about trusts and how they are structured and I am starting to understand them. At some point I need to get my trusts and have the beneficiary to be an LLC for maximum protection as you stated in one of your previous posts.
My main challenge is finding a trustee I can trust to put on the contracts. I will keep researching this point to figure out how can I purchase under a trust if I operate on my own.