We have discussed briefly how you can protect real estate assets in other articles. But as you know, brief discussions are not going to help you much. The best thing to do is to always consult with someone, a lawyer or us, who knows best how to help you in your particular situation. If you cannot, for some reason, do that, however, this article will cover some more in-depth strategies on using mortgages to protect your real estate assets. Please note that you should only follow these instructions after making sure it is the right thing to do for your situation.

If you have ever played Monopoly, or have experience in real estate, you know that you can pull out a mortgage on your home, which is a type of loan, to gain cash in case you don’t have enough money to payback the bank for the home. You can then, overtime, pay back this mortgage with interest to the bank to regain possession of your home, full possession that is at is still under your name while mortgaged. Think about this now, you can take out the value of your home and fill it up with loans that need to be repaid by the owner. You can store the cash, which is the most liquid of any asset, in an offshore account and claim that you do not have it. Now you have a real estate asset that is near worthless and will actually cost someone else money to fully own. Who is going to pursue that kind of asset in court?

Now lets look at this from the perspective of the lawyer who will be defending or prosecuting against you. You own this home that he feels his client is entitled to so he is suing you for it. All of a sudden he finds out that the home has mortgages and loans taken out against it and cannot be worth much at all. On a side note it is a good rule of thumb to keep twenty percent or less of the home value. The lawyer now may ask where the money is that you borrowed for it. If it is in offshore account in Panama, the money is untouchable and the opposition cannot see or know about it. So you can just say it is all gone or that they have all your financial records in front of them. Now what are they going to do? It is too expensive and worthless to go asking Panamanians to give up your privacy, and there is no point in suing for a house that isn’t worth anything. In most cases your opposition will just give up and call it a day in court.

Once the threat in court is gone and the settlement is closed, you can put the value back in your house, be warned there will be interest to be paid, and own your real estate asset once again.