THEN we got ready to close and the lender told me that if I sell the house and transfer title, that they would call the note due.

@Michael CotIt depends on ownership.

He then responded with he wants me to provide ID and proof of ownership of the building.I don't think I would do this for a couple reasons. 

@Dave Foster Plan is to transfer title to LLC prior to sale. 

Think of your "houses" like buses for your cash to ride, transferring from one bus to the next, until you get to your final destination.  

There has to be a very good reason, acceptable to the IRS, for alloting the depreciation in any different percentage than what the LLC/Partnership agreement shows as the percentage ownership of each individual.

You can't determine CoCReturn since that is an analysis that ONLY includes the first year...and there is no way can narrow down the first year since bits and pieces of what would be included in this analysis, that usually would be restricted to the first year, are scattered all over the years of ownership.

Your Mother could give your Father a $365,000 note secured by Trust Deed in exchange for a Quit Claim Deed transferring his ownership to your Mother.

One big question I have is - Are there any downsides to transferring A 30-year conventional loan to a LLC after closing?

@Ankan Basak if you do decide to keep it, one thing to keep in mind is if he moves out say 2 months from now and the refrigerator fails 6 months from now, you likely won't have the benefit of the manufacturers warranty unless the warranty is transferable which generally it is not.