Consequences of Transferring Property from LLC to Personal?

[Jason L.]

I am looking into refinancing one of my rental properties, which I own under an LLC. The lender requires that I move the deed into my personal name in order to get approved. Some questions I have as a result of this:

1. To anyone who has done this before, what kind of costs are associated with this?

2. Is there anyway to co-sign a loan in my own name with the LLC instead of a transfer? Any other potential workarounds?

3. I do not currently nor have I ever owned any property under my personal name, but I was planning to use some of the refi money as a down payment for a primary residence. I'd like to try to buy a primary under a first-time home-buyers program like FHA, but I'm afraid that transferring ownership of my rentals from my LLC might disqualify me from these first-time buyer programs. Would I be correct in that assumption?

Any information you may have would be appreciated. Thanks.

[Daniel Schiller]

@Jason L. No no no. Find a new lender that's a regional bank or credit union. They will lend directly to the LLC with a personal guarantee requiring 3 years of tax returns, a personal balance sheet and declaration you aren't involved in any lawsuits (or disclosure of details if you are.)

For reference these are non-conforming loans; also called “portfolio loans”. That’s all you want for investment properties. Then build the relationship and start pushing for non-recourse on future deals.

After you close the deal and all your accounts with current bank, go find a nice gift box, fill it with dog poop, write a nice note thanking the guy that gave you such poor advice. He sounds like the UBS guy who insisted I close my credit card accounts with zero balance when purchasing my first primary residence.