Written by A nominee agreement in real estate refers to a legal arrangement where a person (the nominee) holds a property for the benefit of someone else (the beneficial owner). This arrangement is often used in situations where the beneficial owner wants to keep their ownership of the property anonymous.
Nominee agreements are commonly used in high-value real estate transactions, such as when a celebrity or wealthy individual wants to purchase a property without revealing their identity. It allows them to keep their ownership private and protects them from unwanted attention or scrutiny.
The nominee acts as a trustee for the beneficial owner, holding legal title to the property but with the understanding that they have no beneficial interest in the property. The beneficial owner retains all rights to the property, including the right to sell, lease or develop it.
Nominee agreements are also used in cases where a group of people is purchasing a property together, but only one person is listed on the title. This person would hold the property as a nominee for the group, and the beneficial interest would be divided among the owners as per their agreement.
The nominee agreement must be carefully drafted to ensure that the beneficial owner`s rights and interests are protected. The agreement should clearly define the roles and responsibilities of the nominee and the beneficial owner and specify the circumstances under which the nominee can act independently.
It is important to note that nominee agreements must be disclosed to all parties involved in the transaction, including lenders, lawyers, and real estate agents. Failure to disclose a nominee agreement can have legal consequences.
In conclusion, nominee agreements in real estate can be a useful tool for protecting the privacy and anonymity of property owners. However, it is important to ensure that all parties are aware of the arrangement and that the agreement is properly drafted to protect the interests of the beneficial owner. An experienced real estate lawyer can guide you through the process of creating a nominee agreement that meets your specific needs and protects your interests.