All Forum Posts by: Ryan Fahey

@Ryan Fahey

This post is not too offend anybody but just reading the first sentence my head is already spinning. Why? Because many investors spend so much time trying to set up these extremely complex strategies for things like anonymity and asset protection, and at the end of the day realized they just spent thousands of dollars for nothing.

For example, when people set up a Wyoming LLC for anonymity. Most people do not pay cash for properties, they finance it. When you finance a property, the mortgage or deed of trust is recorded and is signed by the borrower, which is you. So any anonymity is immediately thrown out the window.

Then, when we look at Holding companies, if you run a business that has different verticals, such as manufacturing, trucking, distribution, yes, holding companies are great. Holding company for real estate is like wearing a belt when you already have suspenders. It’s there, but it’s really not doing anything.

So why did I post this? It’s because far too many people follow the herd, even when the herd is walking towards a cliff.

ask yourself this question before you do something: is doing this and the cost i am incurring going to reduce my risk to justify the cost?

@Ryan Fahey

bottom line: legal entities are NOT eligible for conforming residential loans. You want the limited liability protection of a LLC, you have to use commercial, i.e. non-residential, financing.

Your corporate veil is a legal issue, not an accounting or financing issue. Transferring the deed around only serves to provide basis for using the LLC as an alter-ego.

And, assumedly you want the anonymity from the WY LLC. As soon as you sign "just about" anything, your name is associated with the LLC. Game over...

Of course, consult a qualified professional or two.

1-4 units Fannie loans never allow Land Trust vesting. You could put it in a Living Trust with the trust name being some derivative of the address; HOWEVER, conventional your name shows in the signing. Conventional are personally guaranteed, show on your credit and the hazard insurance has to also match the vesting. Your lender lacks experience. If you close in your name and transfer the deed after it is a SALE this can trigger the lender to call the loan, you can't get insurance to match the note and they check. When you sell to your new entity vesting your title insurance is no longer valid, and you owe transfer taxes. The transfer deed also shows YOUR NAME and makes you visible to the public forever.

If you are stuck on the Land Trust/LLC that you set up you need to switch lenders and do a hard money loan.