Closing in the Name Of

Reblogger Nick Vandekar, 610-203-4543
Real Estate Agent with Long & Foster Real Estate Inc 610-225-7400 PA License - AB067198

Thinking of buying a home or 1-4 unit building as an investment in the Main Line or Tredyffrin Easttown area. How do you do that you might wonder? Am I using my own money, or can I borrow the funds to do that?

This post below by Rob Spinosa is an excellent primer on the subject. Watch the video or read the information but it will educate you on how you can take title and how to finance it.

Then when you are ready to proceed call Nick Vandekar, Selling the Main Line with Long & Foster Real Estate Inc., office 610-225-7400, cell or text 610-203-4543, Nick@VandekarTeam.com, www.SellingTheMainLine.com.

 

Original content by Rob Spinosa NMLS: 22343

Closing in the Name Of

 

There will be no profanity in this post, just in case you get the cultural reference in the title.  I won't even repeatedly scream at you.  Instead we're going to cover a topic that sidesteps injustice, drama or even frequent occurrence, but it deals with a scenario that comes up occasionally and when it does, there is quite a bit we should know before taking action.  So let's talk about closing a residential real estate transaction in the name of an LLC or other business entity, like a partnership or a corporation.  Can you do that?  What's different and where does one start the process?

 

[Too lazy to read the rest?  Watch the video instead!]

 

Guarantee, Guarantor, Guarantas

The first two words above, anyway, are the key concept here.  It is indeed possible for a one- to four-unit residential property to be closed or vested in the name of a business entity, but when this happens, essentially what's transpiring on the lending side is that one or more of the business owners are using their personal income, asset and credit profile to guarantee the loan on behalf of the entity.  So, in essence, the "borrower" becomes a "guarantor." Again, critical to grasp the concept that the business itself is not the borrower(s).  If that were the case, we'd be talking about a commercial loan and not a residential mortgage, as here.

 

Wage Against the Machine

Consistent with a traditional mortgage for a traditional borrower with a traditional credit profile, our business entity borrower will have to provide an additional layer of documentation pertaining to the business itself.  When vesting or closing in the name of an LLC, partnership or corporation, the owners of the business, if not the same as the borrowers/guarantors for our loan, will need to provide articles of incorporation, partnership agreements and other forms and questionnaires to support that the owners are all aware that a mortgage is being taken on the subject property.  Perhaps most importantly, when seeking to obtain a loan in the name of a business entity, expectations need to be set up front to assure that the "borrowers" as well as the other majority owners in the business understand what will be involved. 

 

So yes, we can close in an LLC.  We can close in a partnership or corporation too.  But we have to view things differently from Day 1 in order to get it right and our clients must understand what will be expected of them and their co-owners.  With the new tax laws and with an increasing number of real estate investors holding their properties in an entity for both legal and tax purposes, closing in an LLC or other entity is becoming more common.  If you have questions about how to efficiently get a mortgage in the name of such an entity, let me know how I can assist.

 

Some of those that work forces, 

 

 

Robert J. Spinosa
Vice President of Mortgage Lending

Guaranteed Rate
NMLS: 22343 
Cell/Text: 415-367-5959 
rob.spinosa@rate.com

Marin Office:  324 Sir Francis Drake Blvd., San Anselmo, CA  94960

Berkeley Office:  1400 Shattuck Ave., Suite 1, Berkeley, CA  94709
 

*The views and opinions expressed on this site about work-related matters are my own, have not been reviewed or approved by Guaranteed Rate and do not necessarily represent the views and opinions of Guaranteed Rate.  In no way do I commit Guaranteed Rate to any position on any matter or issue without the express prior written consent of Guaranteed Rate's Human Resources Department.

 

Guaranteed Rate. Illinois Residential Mortgage Licensee NMLS License #2611 3940 N. Ravenswood ChicagoIL 60613 - (866) 934-7283

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Topic:
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Tags:
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nick vandekar
main line realtor
tredyffrin easttown realtor
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Rainmaker
4,352,848
Ron and Alexandra Seigel
Napa Consultants - Carpinteria, CA
Luxury Real Estate Branding, Marketing & Strategy

Nick,

Great idea of getting an expert to explain.  Wishing you a great rest of Thursday. A

Jan 24, 2019 09:44 AM #1
Rainmaker
3,541,641
Sheila Anderson
Referral Group Incorporated - East Brunswick, NJ
The Real Estate Whisperer Who Listens 732-715-1133

Good afternoon Nick. What a terrific choice for a re-blog. I read it when first published.

Jan 24, 2019 09:56 AM #2
Rainmaker
751,075
Nick Vandekar, 610-203-4543
Long & Foster Real Estate Inc 610-225-7400 - Devon, PA
Tredyffrin Easttown Realtor, Philly Main Line

Ron and Alexandra Seigel I agree completely and we have many excellent choices of experts.

Sheila Anderson I knew as I began reading it that it was a perfect choice today for a re-post.

Jan 24, 2019 12:58 PM #3
Rainmaker
3,140,047
Lawrence "Larry" & Sheila Agranoff. Cell: 631-805-4400
The Top Team @ Charles Rutenberg Realty 255 Executive Dr, Plainview NY 11803 - Plainview, NY
Long Island Home and Condo Specialists

Sure, getting the right professional to answer questions about the Real estate transaction is a smart idea!

Jan 24, 2019 04:18 PM #4
Rainmaker
4,039,398
Joan Cox
House to Home, Inc. - Denver Real Estate - 720-231-6373 - Denver, CO
Denver Real Estate - Selling One Home at a Time

Nick, great choice for a reblog, and missed the original post.  

Jan 25, 2019 05:41 AM #5
Rainmaker
751,075
Nick Vandekar, 610-203-4543
Long & Foster Real Estate Inc 610-225-7400 - Devon, PA
Tredyffrin Easttown Realtor, Philly Main Line

Joan Cox I find reposts very helpful as I miss so many posts throughout a week.

Jan 25, 2019 06:04 AM #6
Rainmaker
3,098,344
Will Hamm
Hamm Homes - Aurora, CO
"Where There's a Will, There's a Way!"

Good Morning Nick, You came up with a great reblog for us here in the rain from Rob.  Thanks.

Jan 26, 2019 07:40 AM #7
Rainmaker
751,075
Nick Vandekar, 610-203-4543
Long & Foster Real Estate Inc 610-225-7400 - Devon, PA
Tredyffrin Easttown Realtor, Philly Main Line

Will Hamm love to share the knowledge of others and as you say Rob has much to share.

Jan 28, 2019 07:41 AM #8
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Rainmaker
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Nick Vandekar, 610-203-4543

Tredyffrin Easttown Realtor, Philly Main Line
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