A land trust in real estate is a land-ownership agreement whereby a trustee holds recorded legal and equitable title to real estate, but the rights, responsibilities and advantages of ownership remain with the beneficiary, according to First American Title. Land trusts are legally allowed in nine states.
A land trust is a useful legal tool for people who hold real estate because it offers significant legal protections for the beneficiary, notes attorney William Bronchick, host of Legalwiz.com. Among the most important protections is privacy because trust agreements are not public record. Protection from personal liens and title claims against the beneficiary are another advantage because such claims are limited to the trust and not the beneficiary. Additionally, ownership of a land trust is assignable, and the beneficiary of the trust can be changed without affecting the title, Bronchick explains.