Robbing Peter to pay Paul...

[Sean O'Connor]

I am currently holding a rental property in my personal name and would like to transfer title to newly formed LLC. Not wanting to trigger getting my loan called, here is my line of thinking...

Current mortgage is $58k.  Purchased for $73k in 2013. House is worth about $100k.

Just got approved this morning for a $50k personal loan from USAA.

Delay first payment for 60 days.

Pay off mortgage with personal loan, making up the difference with savings.

Transfer title to my LLC.

Take out home equity loan to re-leverage property.

Would the bank reappraise the house to use today's value or use the purchase price from 2013 when determining LTV?

Also, is this my best option for pulling equity back out of the property?

Thanks!

[Sean O'Connor]

I have been talking to a small local bank that works with a lot of investors. Lending to a newly formed LLC is not a problem for them, so long as I sign a personal guarantee and meet their normal lending requirements.