Hardmoney loan - llc or personal name?

Question

David Disraeli · Answer

This is what Fannie Mae says about transfers after purchase:  https://servicing-guide.fannie...

Garrett Gruss · Answer

Thanks Caroline. I'll go ahead and just use my llc for purchase

Caroline Gerardo · Answer

Since David personally messaged me I am clarifying what I said. If you close any federally backed loan and transfer the deed to a LLC AFTER closing it is mortgage fraud. Fraud is prosecuted by the FBI. Think fines and orange jail suit.  If you close a loan not sold to our government the lender and servicer have the right to call the loan due and payable. Read what you sign. Since rates are low - lenders and servicers won't hesitate to make you sell or payoff the low rate or foreclose.                                                                                      Other problem with this scheme is property taxes increase to current value and you owe transfer taxes as with any sale.

If you are worried about asset protection - do things right.

Caroline Gerardo · Answer

@David Disraeli of course he CAN sell the property to his LLC in any state BUT you are incorrect. If conventional/government lender sees the transfer deed, and they will, the lender can call the loan, happens all the time. Borrower signs agreement that he won't do this.  Here's the number (202) 324-3000 The FBI does not just let you change it back.

David Disraeli · Answer

Caroline you absolutely can move to an LLC here in Texas.  Done if for clients at least 200 times.  In Texas the LENDER will not see the transfer unless they go looking and they don't care.  No one I know has every had the due on sale clause enforced in 35 years.  In any event, if they saw it what are they going to do?  The remedy is to deed it back.  Takes two business hours.  Problem solved.

Caroline Gerardo · Answer

If you get a conventional loan you cannot transfer to LLC. Lender WILL see the sale transfer deed and what will you do about fire insurance? Fire hazard policy goes to the lender. If you keep the hazard in your personal name but sell to a LLC you will have a problem getting paid on a claim. Poor advice.

Hardmoney loan - llc or personal name?

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