Re-finance a current loan out of state

5 Replies

Hi BP'ers, Looking for some advice or if this can be done. I have two rental properties that were purchase in Memphis, TN. I live in another state and would like to refinance out of a high % into a lower one. The properties were purchased with my Solo-K and are a part of that LLC. These are non-recourse loans also. Can I quitclaim them into my name for loan purposes and then back into the LLC after the loan is processed? Looking for other options if this one can't be done, as well as lenders in TN. Thanks for the help.


@Dave Bicket your question pretty detailed and would require specific expertise. I am not an expert but what I have read I think that going in and out of the LLC might cause problems but again that's not my expertise.

You can search for mortgage broker in Tennessee and see what comes up. Of course carefully vet anyone that you find here. Most folks are good but there is no filter that let you know which ones are less than knowledgeable.  

Hi Bill and thanks for the input. I have contacted an attorneys office that does closings in TN, so I would assume they know the law and would protect themselves against any wrong doing. I have a 12% loan now and may be able to reduce this to 4.25%, what a savings!!

Are you currently investing in Denver? I would love to extend my knowledge base and network. Let me know if interested in lunch sometime and swapping ideas and past or current ventures.

Dave 720-989-9491

@Dave Bicket  I sent you a colleague request. I am interested in the storage business so would like to connect some time for coffee or lunch to pick your brain.

I'm not a lawyer nor an expert.  So take this for what it's worth.

Check out Sutton's book on Legal Loopholes.  I think he did some work on this topic.

If memory serves, moving the deed from you to your LLC has not historically triggered the due on sale clause. So, the plan of moving the deed back and forth to facilitate a mortgage, and/or security is a viable option.

With that said, I wouldn't do it. The spirit of the law and contracts, insofar as I understand them, is that you need a divide between you and the LLC. What you're describing feels like commingling personal and LLC assets, and may threaten the ability of your LLC to act as a legal barrier. This feels like a minor, but intentional misleading of both the LLC and mortgage - so even if can be done, I'm a conservative investor and wouldn't do it.

If you wanted to do something like this, I would suggest finding a RE attorney and getting their guidance.  With that said, I've asked similar questions of a RE attorney who didn't know the answer...

@Dave Bicket that is definitely a question for an attorney. I can tell you as far as conventional financing that the properties will have to be in your individual name. According to one of my attorneys the property can be put back into an LLC 60 days after closing, but I would double check. I would definitely refinance to a conventional and out of a 12% interest rate.

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