Moving Rental into a LLC

[Michael Kulusich]

I need to take rental property out of my name and move to LLC . I called my current Lender and they have informed me they do not Lend to LLC ‘s I believe I have read somewhere that most banks will not carry mortgage for LLC. Currently have a balance of about $180,000 on mortgage, Redfin estimates value at $315,000. Anyone have a Lender that will Lend to LLC is Los Angeles area and possibly do a cash out refi as well.

Thanks

Mike K

[Eric Carr]

What's your reason for taking it out of your name? Why an LLC? The issue with an LLC is that, you are essentially changing owners - from you to the LLC, even if you control the LLC. There is a "Due On Sale" clause that is in just about every mortgage loan and when you move property to an LLC, you are basically selling it to the LLC. The old loan would be paid and a new loan would be opened in the LLC's name, and almost always at a higher interest rate. In fact, your insurance rates will go up also. Just about everything gets more expensive when a business owns the property. As Scott mentioned, Trusts are ideal. Look into a trust - see if it works for your situation