Burning question - due on sale

[Tucker Mccravy]

I have a burning and urgent question - scoured the internet but to no avail.

Will transferring property from a single member LLC to a spouse of that single member trigger a due on sale clause?

Or is it protected under the Garmin St. Germain / 12 CFR 591 exceptions?

Any advice appreciated.

[Account Closed]

Quote from @Tucker Mccravy:

I have a burning and urgent question - scoured the internet but to no avail.

Will transferring property from a single member LLC to a spouse of that single member trigger a due on sale clause?

Or is it protected under the Garmin St. Germain / 12 CFR 591 exceptions?

Any advice appreciated.

If there is a Due on Sale Clause, Garn St. Germain (1982) 12 U.S.

Code § 1701j–3

protects only those who are named on the loan. It doesn't matter if they are named on the Deed to the property, only those who are named on the loan. The Loan and the Deed are two entirely different things.

A single member LLC can start out as one person and have the spouse added later or it can start out with both spouses.

So the question is "when the property was financed under the LLC, was the spouse already a member of the LLC" or is the LLC transferring ownership to a spouse not in the LLC? If not already part of the LLC when taking out the loan, it is likely that it is not protected under Garn St. Germain.  But, that doesn't mean the bank will care if it's transferred. There are other factors it takes into consideration as well.

It is simple enough to contact a title company and ask about your specific circumstances. Just use that title company to make whichever change you end up doing.