Due On Sales Clause

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Okay! I have heard so many people talk about the due on sales clause and the possibility of triggering it when transferring title into an LLC. Has anybody reading this every once had the loan called due when transferring title to an LLC????


  • TRATT10th November, 2006

    You have obviously gone a little farther by having a land trust as well, but my question mainly applies to those of you out there that have transferred title directly to an LLC. From what I have read on this site there are many people that have transferred directly into an LLC. Have those of you with direct transfers had any problems with the mortgage company due on sales clause????

  • TRATT1st December, 2006


    Correct me if I am wrong here but anyone transferring title to their LLC would have to use some kind of Deed in order to make the transfer.

  • LeaseOptionKing6th December, 2006

    Bill Bronchick was warning his students to stay away from Countrywide, because of all the hype going around about the DOSC. That is, until he investigated further. Almost all of them were were baseless rumors.

  • LeaseOptionKing6th December, 2006

    Countrywide is one of the few banks that sends a computer-generated form letter, but if you ignore the letter and still make the payments, they will accept them.

  • JohnLocke6th December, 2006

    I have done 50 or 60 deals that Countrywide was the lender without a problem.

    The incident sited was the blind leading the blind.

    Everyone knows that a veteran who served their country and has a VA loan can apply under "hardship" circumstances to transfer their loan to someone else. What has been discribed above certainly falls within those "hardship" guidelines.

    From the VA site:

    Private Sale

    You may sell the property to a buyer who obtains his or her own financing and pays off your GI loan or to a buyer who will "assume" your responsibility for the loan.

    If you read through the Veterans Administration site you will find various ways the VA has set up programs to help the Veteran under hardship circumstances in transferring their property to someone else.

    John $Cash$ Locke

  • lavonc3rd January, 2007

    I agree with LeaseOptionKing. Countrywide is very disorganized and sends out a lot of computer generated letters that are triggered by who knows what. Ignore them.

    However, I would NEVER notify your bank you are going to transfer the deed into your LLC. That will definitely trigger them to consider calling the loan.

    I have transfered five mortgaged properties into my LLC and I have not notified by lenders. As long as I keep paying the payments on time, there is no reason for them to scrutinize where the deeds reside.

    I read an article some time ago that said the only time loans got recalled is when the interest rates had significantly increased and the lenders started reviewing older loans that were an incredibly low rates. They started finding discrepancies and called loans.

    But I would not notify your bank ... ask for forgiveness rather than permission.

  • LeaseOptionKing9th January, 2007

    If you do a subject-to and have a good CYA, just do your own "kitchen table closing." Of course, you could still notify the lender yourself, if you choose to. They only want the payment.

  • apctjb9th January, 2007

    Fair enough; thanks

  • ypochris9th January, 2007

    It has been repeatedly stated by posters on this site that to attempt to get cash back in this manner constitutes loan fraud. However, a seller covering closing costs is a frequent occurance in real estate transactions, as is a seller escrowing funds for repairs. Often this practice results in a sales price greater than the asking price in the listing. The key is that the additional amounts are clearly listed and properly labeled on the HUD statement. In this manner all parties are notified of the details of the transaction, and no deceit or fraud is involved.


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