Personal to LLC loan transfer

[Justin Butterfield]

Hello there, I'm newer to real estate investing and had a quick question. When I put loan in my name for a property and then transfer the deed into my LLC does the loan it's self go into the LLC or just the property title. Im under the impression that the only thing that changes is the property title and if I'm correct wouldn't that still defeat the purpose of the LLC it the loan it's self is still in my personal name? And also is it possible to transfer the loan into the LLC too ?

[Patrick Liska]

Justin,

If you are purchasing the real estate, and you want the protection of the llc, then purchase the property under the llc as well as have the loan under the llc. everything should be under the llc from that point forward. If you purchase under your name and later switch to an llc, some banks will consider that property as being sold, you MAY then be faced with the "due on sales" clause in your loan documents and the bank could ask for full payment of the loan. Investors have done this and the banks did nothing, but it could happen. you are correct in not having the property and the loan under an llc ( only the house) defeats the purpose of having the llc, your name personally is still tied to the property.