Posted by shawn on June 14, 2006 at 16:03:19:
Sorry… Bank of America (I’m in California)
transferring properties - Posted by ralph
Posted by ralph on June 14, 2006 at 13:22:52:
Hello everyone. I would like to know how to transfer a newly aquired property (purchased 3/28/06-owner/occupant)from my personal credit to a corporation. Is this possible ? If so, please share with me the quickest way to do so. Any suggestions will be greatly appreciated.
WHAT ABOUT THIS ??? - Posted by jason
Posted by jason on June 14, 2006 at 14:52:17:
Would it be advantageous to move aproperty I own free and clear from my name to the name of a corporation I own/control? What kind of corp. would I need to remove any liabilty from myself? Would and LLC suffice?
Say, I personally get sued and and they want to attach a lien to my property? Could they touch the LLC?
Say someone gets hurt on the property which is in the name of my LLC… would my home be on the line? Or would the LLC suffice to protect me?
If so, wouldn’t it make sense to have an LLC for each property I won…thus partitioning each from the liabilties of the others?
Re: transferring properties - Posted by Shawn
Posted by Shawn on June 14, 2006 at 13:42:17:
Well, do you have a loan on the property? If so then your “credit” will still show the loan and the lender might take exception to the transfer. If you are trying to do this for “asset protection” then you are putting a bullseye on your corporation as now it will have one big asset that can be seized/attached/executed on. What is the purpose of your transfer? What state is the property in? What type of corporation do you have setup?
Re: WHAT ABOUT THIS ??? - Posted by Shawn
Posted by Shawn on June 14, 2006 at 15:11:58:
Gosh Jason… You bring up quite a few points! Everyone’s plan is customized to their “comfort level” as it were. You should exercise some level of planning no matter what though. LLCs have not been around very long in the grand scheme of things so I think (imho) that they have not really been tested yet. If YOU get sued they will go after your interest in whatever entity you have (LLC, corp etc.)(*internal attack) If that entity holds assets then they are vulnerable. If your ENTITY gets sued then of course any assets are vulnerable.(*external attack)
I would not hold assets in my name OR the name of a single entity in a “vanilla” fashion. My main goals when allocating assets are Tax planning, estate planning, leverage, and asset retention. I don’t want a whole bunch of LLCs to hold property 'cuz that is an admin nightmare. Keep in mind that if a dedicated and bright attorney wants what you have you are probably going to have to settle. ( I am NOT an attorney and I am NOT an expert on this stuff)
I guess your level of “protection” is determined by the volume of business that you do. If you are a “dirtbag” then you are probably going to be sued more than the average investor. Just some thoughts.
Re: transferring properties - Posted by ralph
Posted by ralph on June 14, 2006 at 13:58:02:
Shawn, yes the loan is 150k, in my name. I’m not trying to accomplish asset prot., but have the debt liabilty placed in a corp. that I’ve yet to form. Property located in IL. Also, tenant is currently renting, and this is my first mtg.
Re: WHAT ABOUT THIS ??? - Posted by jason
Posted by jason on June 14, 2006 at 15:20:57:
So then, if an LLC does not LIMIT ym LIABILITY, what are the advantages?
Re: transferring properties - Posted by Dave T
Posted by Dave T on June 14, 2006 at 22:14:11:
According to what I have been told, you do not want your corporation’s only asset to be a rental property. This makes your corporation a personal holding company with a high tax rate structure.
Consider forming an LLC instead, and transfer title to your LLC. You will still be personally liable for the mortgage loan until you can refinance in the LLC’s name
Re: transferring properties - Posted by Shawn
Posted by Shawn on June 14, 2006 at 14:13:10:
I have not met a lender that will allow your corporation to assume your loan on a property without assets. (that doesn’t mean there isn’t one out there)The problem is that it usually takes 2-3 years to establish a track record with your corporation and the lender wants to see at financial statement proving that the corporation can actually repay the loan. They usually require a personal guarantee as well which seems like it would defeat what you are trying to accomplish. You may be able to get a LOC with your corporation and then payoff your loan with that. I have secured a $100k LOC with our bank in the name of the corporation with B of A. They are a little sketchy if your business is RE.
Re: WHAT ABOUT THIS ??? - Posted by shawn
Posted by shawn on June 14, 2006 at 16:01:36:
It does limit your liability to whatever is IN the LLC. There are some tax advantages if you elect to be taxed as a corp AND you know what you are doing.
Re: transferring properties - Posted by ralph
Posted by ralph on June 14, 2006 at 15:52:48:
Shawn, excuse me for lack lo knowledge. Please tell me what B of A is. I understand the line of credit part. Thanks for the info.