All Forum Posts by: Daniel Colon

Don't listen to these hacks, just cooperate with your original lender, by allowing them to get loan sold and securitized (90 days or less), and do yourself a favor by letting your new lender or servicer get the loan boarded onto their systems.

Once the above takes place (or you've given them their reasonable allowance of time requested), just transfer title to your LLC. Both FNMA and FHLMC permit this, under the following circumstances:

• Notes: For all such transfers affecting mortgage loans purchased or securitized by Fannie Mae on or after June 1, 2016, the transferee is not required to occupy the property
• a limited liability company (LLC), provided that
• • the mortgage loan was purchased or securitized by Fannie Mae on or after June 1, 2016, and
  • the LLC is controlled by the original borrower or the original borrower owns a majority interest in the LLC, and if the transfer results in a permitted change of occupancy type to an investment property, such change does not violate the security instrument (for example, the 12 month occupancy requirement for a principal residence).
  • The servicer must notify the borrower that a property transferred to an LLC must be transferred back to a natural person prior to any subsequent refinance application in order to meet Fannie Mae's Selling Guide underwriting requirements.

Citation: D1-4.1-02: Allowable Exemptions Due to the Type of Transfer (04/13/2022)

Now, you will still have the Note and reporting in your name individually and will still be personally responsible for the mortgage and most likely, the manner of transfer will enable any litigant to pierce the veil of your LLC, but you'll have what you wanted, for whatever reason.

The technical permissibility of the transfer aside, as others have stated, it pretty worthless to you in the context you described. 

Also, if the subject property is in California, or any other DOT state, you have some additional considerations with the conveyance.

So, lemme get this straight: You concealed from your lender your plan to transfer the property to a commercial entity after obtaining the loan based on your personal liability. Now you want to whine that the lender says “No”

The problem is where?

 Just curious.  Did you get an owner occupied loan on this property with the intent of renting it out?

 Hey Daniel, 

Have you considered doing a refi into a DSCR loan? Lenders will allow for you to close in an entity.