The way you hold title is often a key factor in determining who is liable for injuries on the property. For example, if you hold title in your name, and an injury occurs on the property due to your negligence, then the liable party will likely be you. Worse yet, the judgment is against you personally so that the judgment creditor can seize all other assets you own in your name. This is a great way to lose everything you own. Even worse is to own assets in joint ownership, specifically, joint tenancy and community property. When your joint owner does something wrong, you can now lose all the assets you own jointly with them, even though you did nothing wrong yourself.
The solution is to own assets in an entity, such as a Limited Liability Company (LLC). Now, when an injury occurs due to the negligence of the owner, i.e., the LLC, the liable party is now the LLC. Only the assets owned by the LLC can be used to satisfy the judgment. In other words, using an entity to own assets protects your personal assets in a lawsuit.
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