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Will
investor
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Mortgages
Wednesday, December 27 2006 12:46 PM
I am currently working with a mortgage broker to refinance a house I just rehab. Here is the senario. The house was purchased and placed in my LLC. I used personal & business lines of credit to both buy the house and rehab it. As it stands there is no mortage on the property. Now I am apply for a "refinance loan" at 80% LTD so I can pay off all of the lines of credit and take some profit out. So here is my question. The mortgage broker is telling me that to get a loan I have to quit claim the property out of the LLC and back into my name, because the banks will not lend to an LLC? The mortgage brokers then suggest that I quit claim the property back into the LLC.
Has any one gone through anything like this? Is this SOP?
Regards,
Will Werhane
"Asking is the beginning of receiving. Make sure you don't go to the ocean with a teaspoon. At least take a bucket so the kids won't laugh at you." ...............Jim Rohn
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Marty Couch
Investor
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Re:Mortgages
Wednesday, December 27 2006 04:05 PM
Hey Will,
1st, this is not SOP. This is to make your loan officer's life easier so he doesn't have to look for a lender who will close in your LLC's name.
2nd, this will compromise your privacy. The property will show you as the owner of record, even if you do put it back in to the LLC. Also, the mortgage will show your name on it. Keep in mind, a lender lending to the LLC will still have your signature on the mortgage and anyone can find out who you are and who owns the LLC.
The best scenario for privacy and protection would be to deed the property in to a Land Trust with your LLC as the beneficiary. With an 80% LTV, you should be able to get a lender to loan in this type of set up.
I think Jim and Randy Hughes have some portfolio lenders who can probably accomplish this for you.
I have been in the mortgage industry for 17 years and currently work as a closer for a title company. I can say I see at least 100 closings a year with the property in either a Land Trust or an LLC.
Bottom line, don't worry about making your mortgage broker's job easier. Do what is best for you.
If you want to know more about land trusts, Jim and Randy have a couple of exccellent classes on them as well as some home study material.
Hope this helps.
Marty Couch
http://www.PPLChicago.com
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Randy Hughes
Land Trust Expert-40+ years of experience
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Re:Mortgages
Wednesday, December 27 2006 04:12 PM
Will,
Marty is exactly correct. You need to learn how to put all of your properties into separate land trusts as your first line of privacy and asset protection. Please consider our Land Trusts Made Simple Home Study course offered on our home page at "Shop Online."
Randy Hughes
866-696-7347
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sycamoremtgbrkr
Mortgage Broker
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Re:Mortgages
Wednesday, December 27 2006 09:28 PM
Will,
i would say the broker you are working with is as has been said trying to make hie life easier. I have a lender that will do the refinance in the LLCs name. I am headed out of town first thing in the morning but will be back late Friday night. Give me a call and i will be more than happy to get back to you Saturday or Tuesday. My number is 815-899-3848.
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