Creative Real Estate Financing

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Kenneth Woodall
  • Real Estate Investor
  • Tampa, Fl
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Transferring loan to LLC to qualify for special deal

Kenneth Woodall
  • Real Estate Investor
  • Tampa, Fl
Posted Jun 16 2022, 00:25

There's a house for sale in a city in Orange County with a deed restriction for eligible buyers. The city placed a restriction so that in order to be eligible, the buyer must not own any other residential real estate unless they sell it before closing.  

This is fairly common in orange county and LA to promote lower to moderate income families to afford a home.

If anyone is familiar with this program, my question is: can someone transfer their residential properties to LLCs. That way they won't technically own residential properties or does it still count as owning properties if a person owns the LLC that owns the properties?

Orange County, California

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Greg Scott#4 Buying & Selling Real Estate Discussion Contributor
  • Rental Property Investor
  • SE Michigan
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Greg Scott#4 Buying & Selling Real Estate Discussion Contributor
  • Rental Property Investor
  • SE Michigan
Replied Jun 16 2022, 06:25

You may want to talk with a real estate attorney to see if it is feasible to have the deed restriction quashed.  

California charges a fortune to have an LLC. Fixing the deed restriction may also be the cheaper route.

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Bob E.
  • Queen Creek, AZ
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Bob E.
  • Queen Creek, AZ
Replied Jun 16 2022, 12:29

@Kenneth Woodall  Sounds like you are looking to avoid the spirit of the law.  Don't be that guy.  

More often than not people that think they are being clever miss something and find themselves in trouble because they missed something.  Unless you have enough money to literally fight city hall stay clearly between the lines.

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Kenneth Woodall
  • Real Estate Investor
  • Tampa, Fl
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Kenneth Woodall
  • Real Estate Investor
  • Tampa, Fl
Replied Jun 16 2022, 12:59
Quote from @Bob E.:

@Kenneth Woodall  Sounds like you are looking to avoid the spirit of the law.  Don't be that guy.  

More often than not people that think they are being clever miss something and find themselves in trouble because they missed something.  Unless you have enough money to literally fight city hall stay clearly between the lines.