Legal Question in Real Estate Law in Arizona

Re: How to protect house in trust?

A living trust does not give you any protection against creditors. If you can access the assets in trust, then the creditors can as well. To accomplish your goals, you are best advised to form a limited liability company or a corporation. Depending upon your intentions with this property, you may be advised to do one thing or the other. If the property is simply your family residence, the LLC will probably suit you best. On the other hand, if you are buying a number of properties for investment purposes, then you must look at tax issues as well as how to best limit liability arising out of the ownership of the properties as well as asset protection. You might also consider a family limited partnership, a commonly used asset protection tool. In all of the above, you can hold title to the property in a name other than your individual names. The cost of forming a corporation or LLC is $500 in fees, plus the filing fees and costs of publication. A family partnership is more expensive, usually around $1,000.