Financing a deal as an LLC

[Matt Engle]

Hello Everyone, I created an LLC to operate my investing business and provide protection to myself and my 2 partners. By running my company through an LLC I found it very difficult to acquire financing for properties in the name of the LLC while the company is still very young (< 3 years old, monthly cashflow < $1000). What options are out there for me to finance a deal in the LLC's name? Additionally, is there a way to transfer the title of a property to an LLC without the risk of the lender invoking the due on sale clause and calling the loan? Thanks for your help!

[Account Closed]

Originally posted by @Nuhan Demirkan:

You can put the LLC on the mortgage along with a personal guarantee. The banks aren't going to lend to an LLC let alone a young one. You may be able to get some headway if you collateralize the loan by using your other properties. Besides the protection of an LLC is mostly from your tenants and other outside people. Having the loan in both names (LLC and personal) and the property deeded to an LLC should give you the protection you need.

I am currently transferring my personal portfolio to an LLC. I figure if the loan is current and performing as agreed the banks should not call it. If they do, I will take out commercial loans thru a portfolio lender and pay of the existing mortgages.

Good luck!

 This is exactly how I did it, for all of my investment properties, including my flips.

Have a discussion with your lender.

Indicate that you want to put the property into an LLC. Tell him or her why.

Indicate that you will open the mortgage in your name, and still be personally responsible.

The lender I use is a "smaller" lender (hometown-ish).  FYI.