Homeowner (investor) has a commercial loan (construction loan converted to permanent financing) on several rental properties. Each property (a single unit and a 2 unit) has a separate loan but are held by the same LLC.
Is there a standard letter available from NARS to alert the lender that the properties are going to be put into a Trust or to ask permission?
The owner doesn/t need to ask permission to put his property into a land trust. It’s best to not even alert the lender of this fact. And you can put more than one property into a single trust if that works for you.
This is NOT correct. The owner of real residential property of from 1-4 units doesn’t have to ask permission to place his property into a land trust. The owner of COMMERCIAL property MUST request permission from the Lender. Also, the exemption from the Due on Sale Clause does not apply on commercial properties.
While it is true that you can keep more than one property in the same trust, it is inadvisable. If you want to refinance a property, you MUST take it out of the trust, refi, then put it back in trust. Lots of extra work if you have more than one property in the same trust. Keep them separate.
Of course a simple trust will work. However, on commercial property, like I said, no DOSC exemption and you have to notify the lender.
Gary is correct. In some cases the Commercial Lender will ask you to pay a “Title Transfer Fee”. This can range from nothing to up to $1000. I’ve done several commercial deals and only had to pay a lender once ($300) for the “permission” and transfer to the trustee.