Transfer home into LLC

[Scott Pyrcz]

Hi everyone, I am looking to purchase a piece of property in Philadelphia using a conventional mortgage in my name and later transfer it to a newly formed LLC. A previous post from 2008 states banks won't let you do it. Have things changed and can it be done now. If so, what is involved.

[Pat Marco]

It is easier to get loans, insurance etc and transact under your own name

If you were doing this llc transfer because of asset proportion, well, contrary to common belief, the llc does NOT protect the asset, it only isolates it from other assets

If you have a home in an llc and you have equity in that home they will go after the equity by suing the llc anyway - even if you don't pay right away they can force the llc to sell and get paid

The best way to protect your assets is
1) keep the property in your name or whatever entity name you have currently
2) set up a Wyoming LLC and draft the OA to have several business purposes and Ibe of them should be asset protection
3) capitalize the entity by placing a promissory note equal to the equity you have in the property you are trying to protect
4) record a lien against the property payable to the Wy llc
5) you would have a 1st lien to some bank and the 2nd lien to your Wy llc
6) the llc is tax neutral because it should be a flow through entity back to your living trust

Anyone trying to sue you will see that
1) you have insurance
2)you have 2 liens and no equity
3) they will end up settling with your insurance

When you sell the house, you simply show the title co. That you have the certificate of ownership of the llc and can remove the lien at any time

Simple, inexpensive, powerful and you can add as many properties anywhere in the US and strip their equity in the same way with just one llc

Cost:
Setting up a Wy LLC maybe less than $1k with the registered agent etc
But the cost would be to draft a good OA that has the business reasons and ways to avoid the charging order etc - that would need an attorney who specializes in this kind of structures and the cost would be somewhere around $3k to $4k

Then you would need an attorney who knows how to draft the lien in a way that would. E based not on a loan but on capitalizing the entity in Wy - with a minimum of one payment per year and deferring interest to the ballon payment at the end of 30 years and clauses for cancellations etc that would cost you another $3k to $4k

Total if you do it on your own probably around $10k - still a lot less than any attorney packages that make you transfer each of your properties to LLCs and then they set up anonymous corporations in NV with trust accounts etc a total mess so they can tie you up with on going fees

The WY llc structure is set up in 72 hours - it can be canceled in a day and it has zero impact on your taxes plus it is form of probate - private message me and I can give you the attorney's firm that set it up for me for less than $5k I have several properties all over the US