Effective Use of Friendly Options in Lieu of Other Controlled Equity Stripping Strategies

[Daniel L.]

I intend to acquire a LOT of seller financed properties as a result of some of my marketing campaigns.I want my nuclear family, future children, and charitable cause to enjoy/benefit from the properties I amass.Learning about prudent ways to maintain privacy+avoid frivolous/abusive lawsuits etc, I’ve learned tons about title-holding trusts (land trusts), SLCC, beneficiary controlled spendthrift trusts, controlled equity stripping strategies etc.One thing that’s come to my attention that seems practical for my goals is selling friendly options on these properties.I would do this the very same day I close on purchase contracts.I’d record the option contract with the county recorder’s office.

Tim Berry (who I expect to call after I gather better understanding) endorses this strategy in a 2 min pitch here: www.youtube.com/watch?v=258RirsQDME

Specific to my situation, I would be closing on the purchase contract with a land trust with an uber trusted friend as trustee.My family member would create their own land trust, have their own uber trusted trustee, and write up the option contract.Being a land trust they would just be contracting for my beneficial interest of course.

I view this strategy as having the following benefits:

1.A little privacy (yes, I’ll won’t mistakenly pay the taxes in my name :)

2.Locking in the option price of the property at the lowest possible denomination for future transfer before appreciation racks up.

3.Protects equity growth from appreciation…not as good as a properly executed friendly shared appreciation mortgage but still a minor deterrent for (frivolous/abusive lawsuits).

4.The option will need a buyback or cancel clause I could execute & record the wipe in event that I want to 3rd party refi/collateralize/ELOC the property.A later option could again be recorded after the refi etc.

I have a zillion tedious but relevant questions regarding this strategy I’ll add following this lead post.FYI Like I said I’ve got the SLCC & liability insurances under wraps.I really want to pick apart the friendly options strategy so I can help detail considerations to other investors otherwise considering the use of friendly options.