How to Transfer a Title of Property From a Person to a LLC

For liability reasons it is always advisable to own investment real estate inside of a limited liability company (LLC). LLCs shield owners' personal assets for the liabilities of the LLC. Typically banks will not allow LLCs to purchase investment properties and instead will require that individuals take title to the property and personally guarantee the mortgage. A property can be purchased personally and then the title may be transferred to a LLC after the mortgage is acquired. Transferring the title of a property is done via either a quitclaim deed form or warranty deed.

Instructions

1. Create a LLC. You can have an attorney set up the LLC for you or you can simply fill out articles of organization with your secretary of state. State filing fees for creating LLCs typically range from $75 to $200.

2. Fill out a quitclaim or warranty deed form. Either form will transfer title of the property from your name into the name of the LLC. The difference between a warranty deed and a quitclaim deed is that warranty deeds guarantee a clean transfer of title while quitclaim deeds do not. Consult with your attorney regarding which deed form to use for your personal situation. It should also be noted that deeds are only valid if notarized.

3. Update your insurance policies. Both your title insurance and property insurance will need to be updated to reflect the new ownership of the property. If you do not update the insurance policies your coverage may not be valid in the event you file a claim.

4. File the deed. The county recorder's office is responsible for keeping records of property ownership within the county. Go to your local county court house with your completed deed form and ask to file the deed. You may need to pay a small filing fee.

Tips & Warnings

• Be sure to sign all rental agreements in the name of the LLC so that only the LLC is liable to the tenants.

References

• Law Problems: "Filling Out a Quitclaim Deed"
• Standard Legal: "How to Use Quitclaim, Warranty, and Survivorship Deeds"
• Nolo: "Who Should Form an LLC?"

Resources

• Free Property Forms: "Quitclaim Deed Form"