Fannie Mae on LLCs & Due-on-Sale

2 Replies

I've been reading about transferring a personal mortgage to an LLC and thought it would be a good idea for my personal investing journey - though I don't have any properties yet. One thing that I've seen come up is that if you transfer the mortgage to an LLC the bank can call due-on-sale (though they rarely do) and then you could be facing foreclosure. Not ideal.

I was browsing on another real estate investing forum and came across this article:

5 Black dots down, 5 white dots down, it mentions that LLCs should (would?) be excluded from due-on-sale regulations.

Do any of you more experienced investors have additional information? Have you dealt with this recently?

@Jorgen Nicholls

This guideline is geared towards a primary purchase that is then transfered to an investment property after the 12 month requirement. But it still states that you could be required to transfer back to personal name if the servicer requests you to do so.