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Richard
Richard, Lawyer
Category: Real Estate Law
Satisfied Customers: 54001
Experience:  32 years of experience as lawyer in Texas. I'm also a Real Estate developer.
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I am very sure I will be sued civilly due to real estate

Customer Question

I am very sure I will be sued civilly due to real estate transactions that haven't gone well. the seller on the contract is an LLC of which I'm the director in the real estate transaction. The ultimate seller was someone else who sold the property. I received the difference between the sellers price and the client. The client is the buyer on the contract. My attorney who has POA signed the contracts. Im wondering if there are any steps I should take before the law suits come that can minimise my personal liability at this stage.
Submitted: 1 year ago.
Category: Real Estate Law
Expert:  Richard replied 1 year ago.
Hi! My name is ***** ***** I look forward to helping you!
I would suggest you protect your non-exempt assets (retirement assets are exempt and depending on the state in which you reside, your homestead may be entirely or partially exempt...and these can be left in place) into a family limited partnership. Carefully drafted, this converts assets that a creditor would find attractive to go after into a limited partnership interest with no control, no rights other than that of an assignment, no transferability, no marketability, and no right to distributions. The transfer is for fair market value…i.e., you are simply exchanging one asset for another of equal value to you. Thus, the creditor cannot sustain the claim that you violated the Uniform Fraudulent Transfer Act by transferring assets for less than their fair market value to avoid creditors. And, you maintain control through a general partnership interest that you control. Yet, when complete it essentially is an asset no one wants and thus the creditor is less likely to pursue the debtor. Family limited partnerships must be carefully drafted but they can be a very effective method of asset protection.
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