While you are busy building your real estate portfolio, making investments and earning your passive income, it’s important to remember to raise the drawbridge and protect your future income. You should work with experienced professionals that understand the real estate investment business. Please note that this article is for informational purposes, not financial or legal advice.
As a Baltimore real estate investor, you must understand how to protect your assets to avoid seeing your investments slip through your fingers. Public records list personal assets and provide information that could make you a lawsuit target. So enacting a strategy to protect yourself from the long arm of creditor claims is essential. As a landlord, you can separate your business and personal assets through an asset protection plan and take steps to limit your risk on individual properties. While nothing is foolproof, these steps are worth the effort. So read on as we explore what Baltimore real estate investors need to know about asset protection.
Landlord Insurance
Liability is a major factor to consider when it comes to real estate investing in Baltimore. As a property owner, you are legally responsible for any damages that occur on your property or as a result of your actions. This includes damage caused by tenants and their guests, so it’s important to make sure you have adequate insurance coverage. Additionally, if someone files an injury claim against you, you should be prepared with the necessary documents and information to prove that you took reasonable steps to protect yourself and your rental property. For example, this could include documentation of regular maintenance checks and inspections or proof that safety protocols were in place. By taking these precautions now, you can save yourself from costly legal fees down the road.
LLC
When it comes to protecting your real estate investments, understanding liability is key. Liability means the legal responsibility you have for certain situations that arise from owning and managing rental properties in Baltimore. Many times landlords can be held liable if they do not take reasonable steps to protect tenants and their visitors from injuries or accidents. This could include anything from making sure stairs are safe to use, general maintenance of the property, or even providing adequate security measures.
It’s important to keep in mind that homeowners insurance typically does not cover most landlord-specific liabilities such as bodily injury lawsuits against tenants or their guests. Investing in a specialized liability insurance policy designed specifically for landlords can help protect you financially in case of a lawsuit involving personal injury or property damage.
Trusts
Trusts serve as a depository to pass on assets to beneficiaries and protect their anonymity from peering eyes, another part of asset protection that Baltimore real estate investors need to know. As the trust’s creator, individuals can hold an ownership interest in an LLC to avoid probate, have full power with the ability to change the terms, or entirely revoke the trust. A married couple’s trust has the potential to save beneficiaries nearly a million dollars in estate taxes.
Land Trusts
Land trusts are exclusive to real estate and mortgages or notes; this is another area of asset protectionBaltimore real estate investors need to know well. Land trusts also provide anonymity and avoid probate and certain liability protections. These organizations take authority or ownership of an investment property at your request as the owner and manage the property on behalf of the owner’s interests as a living trust while the owner is alive.
Real Estate Investment Business
Successful real estate investments can grow great wealth to pass on to your heirs. First, however, it would be best if you understood that investing in real estate is a business and requires dedication, thereby ensuring the long-term value of the holdings in your portfolio for your beneficiaries. Building and maintaining a healthy portfolio means you must know your market, understand the shifts and phases of current market values and be selective about the location of your investments. Investors should interact in the Baltimore real estate market daily to keep tabs on market trends and local changes that affect investments. At CR of Maryland LLC, our professional buyers understand that performing due diligence and running the numbers on each investment requires a reliable team with the mindset of investors. The professional buyers at CR of Maryland LLC have spent years networking among like-minded professionals from every walk of the real estate industry to build the best team in the business.
The professional buyers at CR of Maryland LLC are seasoned experts who built a career investing in the local Baltimore real estate and know the market intimately. At CR of Maryland LLC, we are passionate about helping our investors earn the highest possible returns on their investments and live out their retirement, enjoying their golden years on the cash flow earned through their passive income. At CR of Maryland LLC, we have an in-house team to handle everything an investor needs. Working with a professional buyer from CR of Maryland LLC makes it easy for investors like you to achieve your asset protection goals. Let the pros at CR of Maryland LLC help you find the right location for your next investment or 1031 exchange property. Don’t forget to ask about our inventory of the best available investment properties in Baltimore, steadily updated due to our vast connections in every facet of the local real estate industry. Call CR of Maryland LLC at (443) 391-7080.