Can you transfer conventional loan funds into an S Corp business?

Question

We have an S Corp and want to get a conventional loan to buy a property to use as a short term rental. After you get the conventional loan can you transfer the funds into your business or is that not allowed? Is it better to get a business loan? Need advice….thank you!!

Becky Haag · Answer

@Matthew Crivelli

Thank you!! Did you ever hear of getting a conventional loan and then do a quit claim deed to transfer it to the business?

Matthew Crivelli · Answer

I would go with a private note from the start. Conventional rates on investment properties have now gone up across the board. It may cost you a little more upfront with a private or hard money loan in terms of closing costs but you will be compensated with higher leverage and closing times are much quicker. The borrower would be your entity and you would be a grantor from the start so you wont need to worry about transferring anything after you close. Also less documents, no DTI, no taxes, no employment requirements. Very stream lined process that is good for scaling a rental portfolio!

Can you transfer conventional loan funds into an S Corp business?

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