Protect your Wealth Easily with Real Estate Asset Protection
Do you know how real estate asset protection helped the rich protect their wealth? Before that, let's look at a scenario below...
Imagine you are a real estate investor with tens of properties under you. You feel proud having to own all these expensive and income-generating houses under your own name.
With all the rental income going straight to your bank account, you acknowledge yourself as a rich person. You have truly achieved financial freedom and free of worries forever...until now.
Suddenly one of your tenants decided to sue you by filing a lawsuit. You become panicked and seemed lost.
Due to improper protection, your properties are affected. You are subject to pay a hefty compensation to the tenant for damages, which makes you vulnerable in using your own personal items and belongings due to personal liability.
That's the consequences of not using proper legal entities to protect your real estate assets
So...What's asset protection is all about?
Asset Protection is very important in protecting your real estate business from the unwanted and unpredictable events that can happen to you and your property.
As describe in the example above, real estate investors without some form of protection can risk losing their personal assets if sued by the tenant.
By having a proper protection of your real estate assets, you can minimize your losses and thus protecting your personal assets from being involved.
In order to protect your real estate assets, you must have an entity. Just like someone forming a company to be in business, an entity is a structure that is formed to differentiate your own assets from real estate assets.
Examples of entities are Corporation, Limited Liability Company (LLC), and Limited Partnerships (LP).
It is important to seek professional advice from lawyers specializing in this area. If you are not sure where to start regarding real estate asset protection and forming entities, you might want to educate yourself through by:
1. Reading and researching. An excellent book regarding about which entity to choose is Rich Dad's Own Your Own Corporation by Garett Sutton. This book highlights how the rich safeguard their wealth from legal attacks by using different entity structures to minimize their losses.
2. There are also a lot of specialized professional services out there that will form legal entities for you. They will determine which type of entity and asset protection strategy is suitable on your business circumstances. Their advice will broaden your knowledge further.
3. Home study courses are made available in this subject as well. These courses cover all the essential details about real estate asset protection.
If you're new to investing, then I suggest getting
Rich Dad's Six Steps to Become a Successful Real Estate Investor.
The course covers a topic about forming entities which is easy and informative.
By having a proper entity set up, a real estate investor can then focus on maximizing returns on his or her properties while minimizing losses.
So make real estate asset protection your priority.