LLC's-Transferring properties from personal to LLC

[David Weskamp]

All,

I am in the process of creating LLCs for my properties in Idaho an Arkansas (I live in Idaho).

The properties I own are in my personal name. I own a few free and clear and a few with mortgages.

My question is, What is the best way to transfer ownership into my new LLC's? Is this process different for properties with mortgage vs free and clear?

Thanks,

Dave Weskamp

[Will Barnard]

The process is the same but you do not to take note of 1 item. For the free and clear, just set up the entity and transfer title into new entity. Make sure you ALSO transfer your insurance policy into the name of the new entity! This is true for either free and clear or mortgaged properties.

On a mortgage property, technically speaking, any transfer of title could result in the lender calling the note due. That said, this is so uncommon these days that I have never heard of any investor having this happen to them. I did hear one or two (several years ago) that had the lender mention it, but they never went through with calling the loan due. The clause is named - due on sales clause so look it up in your loan docs. As long as the lender continues to receive payments, they really don't care.