Can I Deed Property To Company/trust After Purchase
I was wandering, if you were having a hard time purchasing property in your business name, can you purchase property in your name and then deed the property over to your business or a trust?
I am not an attorney - and you should consult one on this - but I worked for a title company and now I am a Mortgage Broker...
A possible option - you can't transfer mortgage liability (example - your mom buys your house) without completely refinancing the loan with a new borrower. You can "Quit Claim" an individual on or off title after closing - but beware lenders require that at the closing table you sign a document that prohibits you from doing this. Essentially, this would allow someone to hold vested interested in legal title but not be liable for the mortgage. The lender can actually take serious legal action against you...
But!!! My family owns real estate and they have created - per the instruction of their attorne and CPA that they create a separate LLC (Corp.) for each property. Their are tax benefits as well as huge insurance liability protections...
I think your best bet - and I strongly feel that all investors - have a solid and dependable relationship with a real estate attorney - experienced with servicing investors.
Good Luck!
Kind Regards,
Caterina
Indeed you can place a property into a trust after aquiring int and it will not trigger "due on sale clause" (which is really only applicable anyway with conventional financing.
LLCs are a good entity to hold property in for a variety of reasons the best being their asset protection features.
I would place it in trust with an LLC as the beneficial interest holder.
The problem with placing it into a trust post purchase is that there is a paper trail and if a attorney were to do more than a cursory check of the public records it would show up and could be traced back to you.
SO do both, trust and LLC
Here is an excerpt from an article I wrote awhile back.
Limited Liability Company
The newest of a breed of entities created by state statute requires filing articles of organization through the state where started. It can have 1-2 members depending on your state statutes. This files a 1065 with the IRS like a partnership. When proper procedures are maintained there is a shield between you and your personal assets.
This is the tightest entity for asset protection (in most states). This is because a member’s interest in an LLC cannot be attached by a creditor. If a creditor gets a “charging order” against you for 100k the managing partner could withhold paying you out of the LLC’s assets etc. indefinitely. After years of frustrating the creditor you could settle for less. Generally these have many of the same things that need to be done as a corporation to avoid “piercing”. In my personal opinion I think the best way to hold property is in a trust with the LLC as the beneficiary.
Good Luck
[addsig]
[quote]
On 2004-01-01 20:18, caterina wrote:
I think your best bet - and I strongly feel that all investors - have a solid and dependable relationship with a real estate attorney - experienced with servicing investors.
Good Luck!
Kind Regards,
Caterina
[quote]
What great advice!
I also feel it's good to form a "team". Attorney, tax advisor (may or may not be a CPA), insurance Agent, mortgage advisor, etc...The members may change periodically, but it's good to align yourself with these people. Make sure they are familiar with REI, though. <IMG SRC="images/forum/smilies/icon_biggrin.gif"> [ Edited by norrist on Date 01/01/2004 ]
I have a 2k judgment on file with the court in a county that I want to invest in. (long story, but I refuse to pay) Can this title change be done prior to this judgment attaching to the property?
That's probably a better question for your attorney. Unless an attorney could post a response here...