Refinancing Options When Keeping a Flip Under an LLC (BRRRR Scenario)
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Lender · Tampa, FL · Member since 2013 · 2k+ posts · 2k+ votes
11moA lot of our borrower clients run into this a lot. My wife and I personally, as investors, have had to do it. We have multiple borrower right now that we did flip or new construction loans for that have their properties sitting on the market and we're moving them into DSCRs. I'm not sure I would move the property from your entity/LLC to your personal name. I do not know CA law well, so you'll want to talk to a CA CPA, but I know in FL you run into transfer tax issues. The conventional investor rates really aren't that much lower than a DSCR right now. We closed a conventional investment deal for a client on Wednesday of last week at 6.49% and we're locking DSCRs now at around 6.625%-6.875% in the entities' names. In addition, conventional refis are going to have to meet DTI guidelines using a global cash flow...so we're cash flowing your personal income, personal debt, other properties, etc in one Debt-to-Income Ratio. Most people can't cash flow after 2 or 3 properties conventionally. With a DSCR, we're only cash flowing the subject property...and you keep it in the LLC's name. One tip, make sure the lender you use is actually using the LLC as the borrower. I see some conventional lenders like The Loan Store that will do a DSCR and allow the property to be vested in the LLC's name, but they want the borrower to be the natural person and not the LLC. One other thing to keep in mind in converting a flip to a DSCR, most lenders will allow you to use the appraised value after you've owned the property for 6 months as opposed to your cost. That might drive your LTV down and get you better pricing. Good luck to you!
10 Replies
- Lender · Member since 2025 · 15 posts · 6 votes11mo
Hi Sipan -
If you wish to keep the property in an LLC, your best bet is to pursue a DSCR refinance- as conventional lender will not allow you to hold a property in an LLC.
I am not a tax attorney, but I would generally favor holding a rental property in an LLC.
- 11moSipan Y.Rental Property Investor · San Francisco, CA · Member since 2020 · 78 posts · 23 votesOP
Quote from @Chance House:
Hi Sipan -
If you wish to keep the property in an LLC, your best bet is to pursue a DSCR refinance- as conventional lender will not allow you to hold a property in an LLC.
I am not a tax attorney, but I would generally favor holding a rental property in an LLC.
Thank you
- Lender · Tampa, FL · Member since 2013 · 2k+ posts · 2k+ votes11mo
A lot of our borrower clients run into this a lot. My wife and I personally, as investors, have had to do it. We have multiple borrower right now that we did flip or new construction loans for that have their properties sitting on the market and we're moving them into DSCRs. I'm not sure I would move the property from your entity/LLC to your personal name. I do not know CA law well, so you'll want to talk to a CA CPA, but I know in FL you run into transfer tax issues. The conventional investor rates really aren't that much lower than a DSCR right now. We closed a conventional investment deal for a client on Wednesday of last week at 6.49% and we're locking DSCRs now at around 6.625%-6.875% in the entities' names. In addition, conventional refis are going to have to meet DTI guidelines using a global cash flow...so we're cash flowing your personal income, personal debt, other properties, etc in one Debt-to-Income Ratio. Most people can't cash flow after 2 or 3 properties conventionally. With a DSCR, we're only cash flowing the subject property...and you keep it in the LLC's name. One tip, make sure the lender you use is actually using the LLC as the borrower. I see some conventional lenders like The Loan Store that will do a DSCR and allow the property to be vested in the LLC's name, but they want the borrower to be the natural person and not the LLC. One other thing to keep in mind in converting a flip to a DSCR, most lenders will allow you to use the appraised value after you've owned the property for 6 months as opposed to your cost. That might drive your LTV down and get you better pricing. Good luck to you!
- 11moSipan Y.Rental Property Investor · San Francisco, CA · Member since 2020 · 78 posts · 23 votesOP
Quote from @Doug Smith:
A lot of our borrower clients run into this a lot. My wife and I personally, as investors, have had to do it. We have multiple borrower right now that we did flip or new construction loans for that have their properties sitting on the market and we're moving them into DSCRs. I'm not sure I would move the property from your entity/LLC to your personal name. I do not know CA law well, so you'll want to talk to a CA CPA, but I know in FL you run into transfer tax issues. The conventional investor rates really aren't that much lower than a DSCR right now. We closed a conventional investment deal for a client on Wednesday of last week at 6.49% and we're locking DSCRs now at around 6.625%-6.875% in the entities' names. In addition, conventional refis are going to have to meet DTI guidelines using a global cash flow...so we're cash flowing your personal income, personal debt, other properties, etc in one Debt-to-Income Ratio. Most people can't cash flow after 2 or 3 properties conventionally. With a DSCR, we're only cash flowing the subject property...and you keep it in the LLC's name. One tip, make sure the lender you use is actually using the LLC as the borrower. I see some conventional lenders like The Loan Store that will do a DSCR and allow the property to be vested in the LLC's name, but they want the borrower to be the natural person and not the LLC. One other thing to keep in mind in converting a flip to a DSCR, most lenders will allow you to use the appraised value after you've owned the property for 6 months as opposed to your cost. That might drive your LTV down and get you better pricing. Good luck to you!
Thank you! It was helpful
- Real Estate Broker · Belmont, MA · Member since 2025 · 150 posts · 65 votes11mo
Good question, Sipan. This comes up a lot. If the property is titled under an LLC, most conventional lenders won't refinance it unless it's first moved into your personal name. That usually means you'll need to transfer the title out of the LLC before applying. The trade-off is you'll get better rates with a conventional loan but lose some of the liability protection the LLC offers. If you keep it in the LLC, you're looking at a DSCR or commercial loan, which is faster and easier to qualify for but comes with higher rates. The best move depends on your long-term plan — if you plan to scale, keeping it under the LLC helps build business credit and keeps your portfolio cleaner.
- 11moNick BelskyBusiness MemberResidential and Commercial Broker · Member since 2021 · 1k+ posts · 704 votes
You are free to change vesting at refi in 98% of scenarios so long as there is continuity in ownership. E.g. you can switch from your entity to personal name or even another entity, but YOU must remain on title, whether directly or in the newly vested entity.
Moving things like this has little effect on the loan qualifications, but the tax implications may be very impactful! Be sure to speak with your CPA about moving assets from one entity to another and how that fits into your tax strategy.
Cheers!
Belsky Mortgage, LLC527 Reviews - Accountant · West Jordan, UT · Member since 2017 · 180 posts · 95 votes11mo
Nick,
Thank you for reminding everyone to check with their tax strategist. It is so much easier to plan all the possible scenarios, choose the best path forward, and then implement it in a way that gets the desired results.
Rather than trying to recover from an oppps, after the fact.Saving on taxes speeds up the next BRRRR.
- 11moErik EstradaBusiness MemberLender · Member since 2022 · 6k+ posts · 1k+ votes
Quote from @Sipan Y.:
Hey everyone,
I have a question for those who've been through the BRRRR process or have experience refinancing properties held under an LLC.
Let’s say someone buys a property under a single-member LLC with the initial intent to fix and flip. But after renovations, they decide to keep it as a rental and move forward with a BRRRR strategy instead.
What are the options for refinancing in this case?
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Can the property be refinanced into the individual’s name using a conventional loan?
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Or does it have to stay under the LLC, requiring a commercial or DSCR loan?
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Are there any tax or title implications when transferring ownership for refinancing purposes?
I’d love to hear from anyone who’s done this — what route did you take, and what were the pros and cons?
Thanks in advance for sharing your experience and insight!
In terms of qualifying for the loan, there should be no implications moving title from an LLC to a personal name. As long as the guarantor of the loan is also a member of the LLC and remains on title, you should be good to go.
I would consult with a CPA or tax prepare to confirm if the vesting change willl impact your business
LuxePrivate Investments LLC 572 Reviews -
- 11moAshish AcharyaBusiness MemberCPA, CFP®, PFS · FL · Member since 2017 · 5k+ posts · 3k+ votes
Good question, and one that comes up a lot with BRRRR investors.
From a tax and lending perspective, here’s how it works.
If the property is titled under an LLC, you typically can’t refinance it with a conventional loan, since those are for individuals, not entities. Most investors temporarily transfer the title into their personal name to qualify for a conventional refinance, then move it back to the LLC after closing for liability protection. Just check your lender's seasoning requirements and any due-on-sale clauses.
For taxes, that title transfer doesn't trigger gain or loss if you're the single-member owner. The IRS treats your LLC and you as the same taxpayer, so it's ignored for tax purposes.
If you want to keep it under the LLC, you'd be looking at a DSCR or commercial loan, which usually comes with higher rates but no personal name transfer needed.
Either way, the key is to document your intent clearly and keep your accounting clean so the IRS and lender see a consistent story.
Best of luck with your project, and happy to connect!
INVESTOR FRIENDLY CPA®5241 Reviews - 10moFrankie VozziBusiness MemberMember since 2025 · 335 posts · 82 votes
Hey Sipan!
That's a fantastic question! When it comes to refinancing a property held under a single-member LLC, you typically have a few options.
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Refinancing in Your Name: It’s often possible to refinance the property into your personal name with a conventional loan, especially if you meet the lender’s requirements.
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Staying Under the LLC: If you prefer to keep the property under the LLC, then a DSCR loan or a commercial loan might be the way to go. These loans focus more on the property's cash flow than on personal credit.
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Tax and Title Implications: Transferring the property to your personal name might have some tax implications, so it’s always good to consult a tax professional.
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