Transferred Rental to an LLC and now the bank is giving me issues

[Kenny Isberner]

I recently transferred a college rental property into an LLC. I also transferred the insurance policy to the LLC instead of my name. So the insurance company forwarded that information to the bank which my mortgage is thru and now the bank is telling me that the insurance policy needs to be under my name, not the LLC.

I talked to the insurance agent and he told me that they could potentially just put it back into my name, but then the LLC would not be insured, basically defeating the purpose of transferring it to an LLC in the first place!

Now I've gotta imagine people are transferring rentals to LLCs all the time and this is a completely normal thing?? Unfortunately it's a "big" bank, Old National to be specific, so I can't seem to get a hold of the right person on the phone to resolve the issue and I don't think anyone at my local branch can specifically help me. 

Hoping for some insight or suggestions! 

Thanks

[Wayne Brooks]

@Kenny Isberner It’s because the bank “doesn’t like” or that they “don’t understand”, they understand very well.....you have a conventional loan which is not available to llc’s and your loan has a due on sale, a Fannie/Freddie requirement, that allows/requires the bank to call your loan. 

The whole "must have an LLC" is overblown.....just get a $1-2M insurance/umbrella policy....and sleep well.