Quitclaim good or bad?
I know it's very common to buy a property in your own name and then transfer it into your LLC through a quitclaim deed. But this also means that the title of the property technically changes hands - even though it's your own LLC. So the bank would theoretically have the right to call the loan due since it triggers the due on sale clause. Is this something I should worry about or just assume the bank won't do that?
Hi Petar, I know exactly what you're talking about and am dealing with that now. We just finished refinancing a rental property that is controlled by an LLC. To get around the issue you mentioned, we used a land trust. In other words, we financed in our own name (as the bank requires), then used a trust to transfer the "ownership" of the property to the LLC.
I'm not an expert on how all this works, but it's enabled us to avoid any issues with due-on-sale clauses. If you like, I can get you in touch with the attorney that set up the trust and LLC for us - they are really great to work with and I wouldn't hesitate for a minute to recommend them to you.