- Hey guys, in this video we're gonna discuss
how to protect title to your real estate.
Okay, let's get started.
(upbeat music)
Hey, now this actually came about
because a viewer sent me a question,
wondering how they can protect title to their property.
Now this is a concern for everyone
because there's a lot of information out there
or news reports about people having
their titles stolen from them,
and if you're investing in real estate
the more property you buy,
well possibly those chances go up.
So what are some things that you can do
as a real estate investor to minimize that overall risk?
Well first off you should check with your county.
Now many counties now have adopted something called
property fraud alert, that all you have to do
is go to your county recorder's website,
look for that term, and if it's there,
you can then put in your information about your property,
the property itself and in your information.
And what the county will do is they will alert you
if anything strange is happening with your property
outside the normal, you know,
paying the taxes and typical transfers.
So this is a good first step.
Unfortunately not all counties offer this okay,
more and more are starting to do it, but not all of them do.
So then you could possibly look at one of those services
such as home title lock, to see what they could provide you
as far as protecting title.
And again it's all done with this in mind that
I'm going to ensure that if anything happens on that title,
I'm gonna get notified immediately
or it's gonna be prevented from occurring,
so we don't get too far down the road
and then it becomes a huge financial mess for us.
Now the other thing you should be doing of course,
is monitoring your utility bills and statements.
So one of the things that happens a lot of times
is that people that own real estate
they find they'll set things up on Auto Pay.
And they're paying attention to what's owed,
but they're not paying attention
to the actual billing itself.
And what can happen in those situations is that
if it's coming in say an e-bill and you're paying it,
maybe the property address has changed,
that is where those bills should be sent
the physical copies.
And so by paying attention to that,
making sure you're receiving those bills on a monthly basis
is one way to catch this as well.
Because when people steal title to your real estate,
what they're going to do of course
is transfer over the utilities.
If they were to sell that property to someone else,
that individual is gonna get in there
and transfer everything over into their name,
and then that's gonna notify you of course
that something is a miss.
If you're no longer getting the bills
or the address on the bills,
had the statements have changed.
So monitoring that is important
and that's where a good bookkeeper can come in.
If you have somebody that does your books
for your limited liability companies,
they should be checking on that.
The other thing I would focus on too,
is that when you transfer title
to your limited liability company,
you know I've got videos on how to deed it in
using the proper form of deed,
but taking title I think is important as well.
So let's assume that I set up
Red Rabbit LLC,
and I set up Red Rabbit LLC in Delaware.
So it's a Delaware Limited Liability Company
because that's where I own my rental real estate
this property is in Delaware.
So I have this entity set up.
Well when I transfer title
into that limited liability company here,
the grantor is going to be Clint.
So here is Clint down here on a deed I'm the grantor
that is the person who is transferring title.
And then you have the grantee that is the person
who is receiving title to the real estate.
Now the grantee is gonna be this Red Rabbit LLC.
And so you may be inclined to put down
Red Rabbit Limited Liability Company,
because that is the entity that is taking title.
Well here's an issue that could come up for you.
If you were just to put in Red Rabbit LLC,
it might make it easy for someone to step in
and fraudulently obtain your title.
How could they do that?
Well, this Red Rabbit LLC is set up in Delaware right.
Now, does that stop someone for setting up
a Red Rabbit LLC in Florida for instance?
So someone goes in, they set up Red Rabbit LLC in Florida,
they then approach a buyer with their LLC,
and say, hey do you wanna buy this property,
own it in Delaware, Red Rabbit Limited Liability Company.
They pull up the deed online title says
that Red Rabbit LLC, they trace it back
to this Florida entity that has red Rabbit LLC there.
And fraudster here is the one that says,
yup, I can sell it, and so they sell it.
And so for the appearance purposes, Red Rabbit LLC,
it happens to be the Florida LLC Red Rabbit
that's selling the property.
So the way you prevent this, don't make it easy for people
to commit fraud, is when you're deeding the property
into the grantee, put Red Rabbit LLC
a Delaware Limited Liability Company,
put that down.
All right, so if you put
a Delaware Limited Liability Company,
there's only one Red Rabbit that can exist in Delaware.
And that is your Red Rabbit,
and fraudster isn't gonna be able to sell it
out of a Florida Red Rabbit,
because title whoever looks at it would see
that is supposed to be a Delaware
and not a Florida Red Rabbit Limited Liability Company.
So those are some of the things that you can use
to protect your title.
Generally speaking I tell people,
hey when it comes to protecting title,
if there's an aggressive criminal out there
that just wants to commit fraud,
it's gonna be really hard to stop them from doing it.
You may wanna lien up your properties as well,
you can file liens against them.
You've seen some of the strategy
we'll talk about using a friendly lien.
If you wanted to go this far
so you have an LLC set up over here in Wyoming,
and what you're going to do, here's your property down here,
right here it's in your LLC over here.
You can file a friendly lien
against your property and encumbrance.
And so by having those encumbrances on there,
typically the people who hold a lien against a property
gonna get notified, because if a buyer comes in
and they see all these liens
they may not be willing to buy it.
And so cause you've already sucked up all the equity
and they don't see any benefit there.
So there's things like that you could do as well
to try to protect title,
but those first few go check your county
that is the best thing you can do to ensure that if
there are any changes that property fraud alert
will alert you, and make sure you deed it the right way.
All right guys, hope you liked this video
on how to protect your title,
if you got any other ideas like that
and you want to send and we hear
or email me or put them in the comments,
I would love to hear it
cause I'm always looking for things
that you're interested in
so I can produce more content for you, take care.
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