Assigning a property to an LLC

My business partner and I recently purchased a property in our names. We would like to assign the property to an LLC where we are the only two members. In the bank note, it says if we assign the property without the lenders permission that the bank could call the note. Any advice on how to get the property into the LLC?

Edited: 06/26/2010 at 03:44AM

Tom Wood

Residential Real Estate Broker · St. Louis, Missouri

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Icon_minipost Jul 08 '07, 03:55 AM

Typically you just do a quit claim deed over to your LLC. The bank has the right to call your loan due, but it is unlikely they will.

DISCLAIMER: I'm not a lawyer, this is just my opinion :D

Edited: 06/26/2010 at 03:45AM

Joe Wilson

Accountant · Newtown, Connecticut

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Icon_minipost Jul 29 '07, 08:37 PM

Contact your bank. You should have no problem retitling your property under your LLC's name and reissueing the loan under the LLC as well with a guarantee signed by you and your partner to the bank.

Probably get away with about $750 in fees with the Lawyer and bank fees.

The attorney will do a retitling so that will save you money instead of a full closing.

Joe

Edited: 06/26/2010 at 03:49AM

Account Closed

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Icon_minipost Jul 31 '07, 05:45 PM

Originally posted by "RECPATAXMAN"

Contact your bank. You should have no problem retitling your property under your LLC's name and reissueing the loan under the LLC as well with a guarantee signed by you and your partner to the bank.

Probably get away with about $750 in fees with the Lawyer and bank fees.

The attorney will do a retitling so that will save you money instead of a full closing.

Joe

Joe,

I doubt very much that the lender will be OK issuing a new loan or otherwise taking the borrowers off the present loan. The lender might be fine for the property to be put in the LLC while the loan remains in the two individual names.

Any lender that would agree to what you are suggesting is a lender that would be fine issuing a loan to an LLC in the first place. A few exist but not enough to make it interesting for most investors.

John Corey

Edited: 06/26/2010 at 03:50AM

Joe Wilson

Accountant · Newtown, Connecticut

123 posts
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Icon_minipost Jul 31 '07, 06:47 PM

Originally posted by "REI"

Originally posted by "RECPATAXMAN"
Contact your bank. You should have no problem retitling your property under your LLC's name and reissueing the loan under the LLC as well with a guarantee signed by you and your partner to the bank.

Probably get away with about $750 in fees with the Lawyer and bank fees.

The attorney will do a retitling so that will save you money instead of a full closing.

Joe

Joe,

I doubt very much that the lender will be OK issuing a new loan or otherwise taking the borrowers off the present loan. The lender might be fine for the property to be put in the LLC while the loan remains in the two individual names.

Any lender that would agree to what you are suggesting is a lender that would be fine issuing a loan to an LLC in the first place. A few exist but not enough to make it interesting for most investors.

John Corey

I guess I was lucky then, because both Suntrust and BB&T did it. I had to renew my loan at Suntrust and asked if I can put the loan in the LLC's name and she said sure, we'll just get a guarantee. I contacted BB&T and she said yes we can issue a new loan under the LLCs name and it will be $258.00 in bank fees.

As I mentioned before, the bank will want a guarantee signed by the LLC members.

Joe

Edited: 06/26/2010 at 03:50AM

Lee V

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Icon_minipost May 03 '09, 03:13 PM

I know this is an old post, but just wanted to get an update to the above reference.

Do anyone know of any bank in today credit crunch that will allow a loan to be transfer from an individual into an LLC with the individual just guaranteeing the loan?

Edited: 06/26/2010 at 08:07AM

Jim Wineinger

Real Estate Investor · ten mile, Tennessee

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Icon_minipost May 03 '09, 03:31 PM

The other question that I did not see addressed in the posts is that most mortgages and trust deeds have clauses requiring title insurance and most title insurance companies will not insure a title recieved by a quit claim deed they want to see a warranty deed.

So you need to be sure the bank is ok and the insurance company is also ok or you may run into problems in the future even if the loan is not called due as claims which may arise are not paid due to the wrong entity being insured.

Edited: 06/26/2010 at 08:07AM