Question about refinancing rental properties

[Dan Simpson]

I have a question about refinancing rental properties... I own 4 rentals which have balloon loans on them. All are about to expire, so I need to refi. 

I prefer to refinance on the secondary market which offers lower interest rates for investment properties and longer terms, but I was told by one lender that they can't refinance on the secondary market because the titles to the properties are held in my LLC, and not my own name. If the properties were in my own name, then they could do a 25 yr loan at around 5% interest rate up to 70-75% LTV

But instead, they are saying that because the properties are titled under my LLC, they can only do an in-house 5 yr balloon loan with a interest rate around 6%, amortized over 25 years.

Does this sound accurate? I find it hard to believe this, since most investors probably title their rentals under an LLC.

[Scott Smith]

@Dan Simpson @Alex S. A strategy often used to get both good financing options and liability protection (insurance doesn't always cover everything, so it's good to have a "fall-back") is by using a Land Trust. The investor purchases the property in their person name and then transfers the property into a land trust, which the lender cannot exercise the Due on Sale Clause against due to the St. Germain Act. At this point the investor can be assigned as the trustee and the LLC would become the beneficiary. You still get liability protection through the LLC for that property, and you can hold onto the financing available in your personal name. An experienced attorney can also remove your name from public record for that property, creating anonymity, and lay the groundwork for future estate planning - the Land Trust is an inter vevos trust.