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Updated over 1 year ago on . Most recent reply
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Business Trust or Asset Protection Trust for holding Rentals
Hello everyone, has anyone used a business trust to hold rentals instead of an LLC because California charges a yearly FTB fee of $800 whether or not your LLC was formed in California? Or maybe a Tennessee Asset Protection Trust? I have talked to a couple of lenders and they have told me that if I transfer the property into an irrevocable trust, it would trigger a due on sale clause.
Have any of you encountered this and how did you avoid the due on sale clause?
Also, how did you get a mortgage when buying a rental in a business trust or asset protection trust?
Does transferring your real estate in an asset protection trust trigger property tax reassessment?
Is it harder/more expensive to get insurance in a business trust or asset protection trust?
Thanks!
Most Popular Reply
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Quote from @Diane Tycangco:
Hello everyone, has anyone used a business trust to hold rentals instead of an LLC because California charges a yearly FTB fee of $800 whether or not your LLC was formed in California? Or maybe a Tennessee Asset Protection Trust? I have talked to a couple of lenders and they have told me that if I transfer the property into an irrevocable trust, it would trigger a due on sale clause.
Have any of you encountered this and how did you avoid the due on sale clause?
Also, how did you get a mortgage when buying a rental in a business trust or asset protection trust?
Does transferring your real estate in an asset protection trust trigger property tax reassessment?
Is it harder/more expensive to get insurance in a business trust or asset protection trust?
Thanks!
Just keep it in your name and get an insurance policy!!!
- Chris Seveney
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