Are land trusts legal in Colorado?
If you are reading this because you are interested in Colorado conversation trusts, you found the wrong place. But if you are interested in title holding real estate land trusts in Colorado, you’ve come to the right place.
Land trusts, also known as “Illinois Land Trusts” are title holding revocable trusts for masking ownership of real estate. Unlike Illinois, Colorado does not have a specific land trust law. However, that does not mean Land Trusts are not legal in Colorado. In fact, Colorado title companies insure title to and allow transfers from land trusts all the time. Land trusts are created by trust agreement under common law trust principles. A trustee is appointed under the trust agreement and the beneficiaries are designated under the trust agreement. The trust is for a valid and legal purpose, and it is revocable and living, which means it is a form of revocable, living trust. Are revocable, living trusts valid in Colorado? You bet they are!
So what’s the difference between a standard revocable, living trust and a title holding land trust? Mainly the difference it twofold: 1. The living trust vests all power and authority in the trustee, whereas the land trust leaves the power of direction in the beneficiaries, and 2. The beneficial interest in a land trust is PERSONAL property and the beneficial interest in a land trust is equitable ownership of real estate. So, what exactly does this legal mumbo jumbo mean? Not much to the average person other than the land trust is valid and legal in Colorado!