Top six mistakes in establishing and using a Florida Land Trust:
1. Using an entity owned by the beneficiary, or the beneficiary himself, to act as trustee of the land trust.
This defeats the privacy usually provided by the land trust
2. Using a "friend" or employee to act as land trustee
"Trustworthy" friends and employees sometimes steal the trust property or strip the equity out of it with mortgages unknown to the beneficiary.
3. Improperly naming the trust as the buyer or seller in a real estate purchase and sale contract.
With REO properties, this is especially troublesome when it comes time to close.
4. Putting multiple properties into the same land trust.
This defeats the purpose of using the land trust structure to isolate one property's liabilities from another.
5. Providing copies of the land trust or even recording the land trust document so that third parties discover the identity of the beneficiaries.
6. Waiting until it is too late to move the property into a land trust.
Many real estate investors wait until they have a potential lawsuit pending before they look at using a land trust for asset protection via privacy. At that point, it is too late.