Property owners with homes or real estate valued at $1 million or more can protect their wealth from lawsuits and creditors through strategic asset protection, according to a leading legal expert.
Gideon Alper, an asset protection attorney at Alper Law, shared: “High-value properties are prime targets in lawsuits, but tools like homestead exemptions, LLCs, and trusts can shield them from creditors. With proper planning, you can secure your real estate and avoid devastating losses.”
For many Americans, a $1 million property—whether a primary residence, vacation home, or investment property—represents a significant portion of their wealth. However, without protection, it’s vulnerable to legal claims from business disputes, personal injury lawsuits, or unpaid debts.
Alper explained: “In states like Florida and Texas, homestead exemptions can protect your primary residence from creditors, regardless of its value, as long as you meet residency requirements. For example, a $1.2 million home in Florida could be fully shielded if it qualifies as your homestead.”
However, he cautioned that homestead laws vary by state, and non-residents or owners of secondary properties need alternative strategies.
For investment properties or second homes, Alper recommended transferring ownership to a limited liability company (LLC). “Placing a $1 million rental property into a multi-member LLC can deter creditors, as they’re limited to seeking a ‘charging order’ against the LLC’s profits, not the property itself,” he said.
However, Alper stressed the importance of professional guidance. “Setting up an LLC or applying homestead exemptions requires compliance with state laws. Mistakes, like improperly titling a property, can void protections,” he advised.
To illustrate, Alper shared: “Consider a retiree with a $1 million vacation home in California, where homestead exemptions are capped at $600,000. By transferring the property to a multi-member LLC, they could shield the full value from creditors, potentially saving $1 million in a worst-case scenario.”
For those with multiple properties, offshore trusts can offer even stronger protection. “A $5 million real estate portfolio could be transferred to domestic LLCs owned by a Cook Islands trust, making it much more difficult for U.S. creditors to collect against the equity in the properties,” Alper said. Setup costs for offshore trusts range from $15,000 to $30,000, with annual fees of $3,500 to $5,000, making them ideal for high-risk individuals like business owners or professionals.
An asset protection attorney consultation can provide tailored estimates based on property value, state laws, and risk exposure. Alper emphasized that timing is critical: “It is better to act before a lawsuit arises. However, transferring assets even after a legal threat can still provide significant protection and leverage in negotiations.”
Despite their benefits, asset protection strategies aren’t universal. Alper noted: “Everyone’s situation is different. Asset protection planning is about applying state and federal laws to each particular person’s circumstances.”
Alper also clarified misconceptions: “Asset protection isn’t about hiding wealth—it’s about legally structuring your assets to minimize collection risk. You will still end up disclosing your assets to judgment creditors.”
Ultimately, protecting a $1 million property requires foresight and expertise. “A well-crafted plan can give you peace of mind, knowing your property is secure,” Alper said. “Work with an attorney to evaluate your risks and build a strategy that aligns with your financial goals.”
