Lender wants me to transfer title in and out of my name for loan

[Nick L.]

I was referred to a mortgage broker for a re-fi on a rental property that I own (refinancing out my private lender in to long term financing). Long story short, late in the game, the mortgage broker has informed me I would need to quitclaim the property from my company name in to my personal name to close the loan, and then I can quitclaim it back to my company name immediately after the loan is closed. 

Technically I think they are asking me to violate their due on sale clause. In addition, I will need to pay transfer tax for the transfer back in to my company name.

Anyone have thoughts on this?

[Jeff Lezark]

@Nick L., your mortgage broker may not be aware of the ramifications of doing what he/she is suggesting. If you are applying for any kind of conventional financing you will have to have the property titled in your personal name as conventional lenders lend to people, not corporate entities. If you obtain a conventional loan and attempt to quit claim to your entity you will indeed be breaching the Due On Sale clause as this is in fact a transfer of ownership. Some have had success with contacting the lender and seeking permission to do so but the vast majority do not. The upside is you'll get a much better deal going conventional than portfolio or private lending so it may be in your best interests to quit claim from your entity to your personal name and then leave it there.