Transferring Deed from LLC to Person

[Delicia B.]

Hi All,

This is my first time posting to the BP forum, so I hope I'm posting this in the right place or I'm at least somewhat close.....if not sorry in advance. So my dilemma is I'm trying to get financing for a property that I own outright. There is no mortgage on the property (which is why I need to refinance in the first place as I have no money left....lesson 1 or 549 of when real estate investing 101 goes wrong). Of course I set up a LLC, so yea, I can't (I haven't found that one credit union who is willing to lend to me) get conventional financing. I tried the hardmoney lenders, which put me in a bind and where I learned lesson 2 of when real estate investing 101 goes wrong. One of the requirements to satisfy the closing was doing an oil tank sweep. I'm sure you know what comes next.....yes, there was an oil tank buried underneath the sidewalk clear as day in front of the house. Not sure how I, my partner, AND the home inspector missed it, but we all did. Had said oil tank removed, but of course it had several small holes in it once excavated, so a soil sample had to be taken to make sure it was under a certain threshold. Test came back and low and behold it's above said threshold and remediation is necessary. I'm quoted 9k-11k for clean up. So now I have the issue of having an oil tank that leaked against the property. Obviously I can no longer get funding from a hard money lender until the oil tank situation is remedied. However, I don't have the 9k-11k on hand to complete the remediation. Lesson 3 of when real estate investing goes wrong....always leave yourself with some form of savings on hand.

Now for my main purpose in posting because I'm almost fresh out of ideas and I need some guidance and encouragement. If I transfer the deed from LLC to personal name of a member 1) how do I handle the name change for the title insurance 2) is it a good idea to leave in personal name or transfer back to LLC once refinance is complete (which I'm being told I should do by year's end by my accountant for LLC tax purposes i.e. he said it won't trigger a tax payment either way). I should mention once transferred to personal, I plan to open a HELOC, which should not trigger an appraisal since if I had to have an appraisal done it would probably be denied because the property is not livable (it is down to the studs.....this is lesson 5 since lesson 4 should've been to purchase property in personal name in the first place) Do not tear up your asset before contracts are signed and permits pulled, in other words know that work will start as soon as demo is complete. This way you can at least rent said asset and at least have some income coming in if plans to start work are put on hold for some reason.

Am I correct in thinking that getting a HELOC will work out if I transfer to personal name? They shouldn't have to do an appraisal, should they? Will it be a problem if they see that the transfer was made this week and I apply for the line of credit next week? Will they require me to record them as a lienholder on the deed and would this then prevent me from transferring ownership back to LLC?

Thanks in advance for any and all feedback.