LLC Transfers

JoeDC · August 28, 2005, 11:40am

Can someone please tell me what the steps are to have property transfered into an LLC:

At closing
After closing (property is already in my name and want it in an LLC)

Also, what are the issues with the banks and insurance companies in doing so?

Thanks,

Joe

tedjr · August 28, 2005, 1:02pm

Howdy JoeDC:

The steps are easy: Form a LLC at Sec of State where you live or where you want the LLC and then get a deed and put LLC as Grantee and you as grantor and file at the county courthouse. Why tell the banks and insurance companies?

gmtmaster · September 7, 2005, 9:54pm

Tedjr…

What if he is using the LLC to remove the property tradeline from his personal credit. Wouldn’t he/she need to refi under the name of the LLC?

freedomflea · September 7, 2005, 10:52pm

removing the loan (mortgage) form his credit will not happen until the laon is refi’ed or paid in full. However, if the purpose is to show a new lender that the person is no longer responsible for the mortgage, you can transfer the property to a trust or llc and then supply the lender with the HUD statement for the transfer. this scenario is similar to purchasing a house “subject to existing loans”. the seller will get a hud 1 outlining the transfer.

eternal902 · October 2, 2005, 7:51pm

But wouldn’t this tradeline still appear in your credit report…affecting your current “ratios” in order to secure another mortgage… and would a new lender just accept a HUD statement to show that you are no longer responsible? …and I know there penty of questions regarding this topic but I am still not very clear to me whether or not the so called “Due on Sale” clause does in fact take effect when this happens or if one can just transfer this property free and clear, from one’s name and into the an LLC therefore making this aliability for an LLC…???

tmdub · October 4, 2005, 3:31pm

tedjr:

Howdy JoeDC:

The steps are easy: Form a LLC at Sec of State where you live or where you want the LLC and then get a deed and put LLC as Grantee and you as grantor and file at the county courthouse. Why tell the banks and insurance companies?

With regard to the above post, my understanding is that the mortgage company keeps abreast of such transfers and will eventually find out about it, which will, in turn, trigger the DOS clause and the bank will then tell you to pay up in full the entire amount owing. Thus, don’t you jam yourself up by transferring the deed to the LLC without first notifying the bank? Isn’t being up front with the bank better than not telling them? I don’t want to transfer the property we own to the LLC if it will be problematic on the back end. Any thoughts?

WaltB · October 22, 2005, 3:10am

Please go to a good asset protection attorney or get Pat Tarrs course Armor & Camo and she will guide you thru it for 6 months.