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Updated over 1 year ago on . Most recent reply

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120
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Diane Tycangco
26
Votes |
120
Posts

Business Trust or Asset Protection Trust for holding Rentals

Diane Tycangco
Posted

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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17,775
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Chris Seveney
  • Investor
  • Virginia
15,306
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17,775
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Chris Seveney
  • Investor
  • Virginia
ModeratorReplied
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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7e investments
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