Refinancing into an LLC

[Matthew Don]

Hi all

I am currently house hacking and I want to move my property into my LLC. But, moving it into my LLC wouldn't remove the loan from my name or personal credit. What do I need to do to transfer my loan into my LLC?

[Mike S.]

@Matthew Don

You would need approval from the lender or will risk triggering a due on sale clause when you change the title ownership.

Some lender will accept transfer of the property to a disregarded LLC. Some won't. But even the ones that will accept will not change the loan documents to put the entity as the borrower you will still be responsible for the loan.

You will have to get a commercial loan (higher rate, different term) to get your name out of the loan.

[Polo Vazquez]

95% of lenders will tell you you can't do this. A lot of people do it anyway and get away with it. Lender's usually don't care to foreclose if the payments keep coming, but there is always a chance that they will activate the acceleration clause and make the whole loan due. I've never heard of it happening though....