[WSBAPT] Can a trust hold title to a mortgaged property?

[sdonahue at sdonahuelaw.com]

I have a client who has an estate plan I am reviewing.  The first problem
was that the pour over wills were not witnessed, so we have to change that.
But, the married couple owns property in Washington, Utah, and Oregon.  They
have signed some forms they have called "Assignment of Property" to various
LLCs that they may or may not have created (I am investigating this).  These
"Assignments" say that the property is transferred to these separate LLCs,
one for each property.  But I don't see that these Assignments have any
legal value.  

 

My client just told me that he has not been able to transfer the title to
the mortgaged properties into their respective, separate LLCs-one for each
property--because all except one of them is mortgaged and the bank won't let
them have an LLC hold title to a mortgaged property.  So, that is one issue.


 

They also have a revocable trust, but only one property shows ownership by
its designated LLC.  This is the property that does not have a mortgage.
So, is this property in the trust?  I don't think so.  The other properties
are owned by them either jointly or individually.  So, are these properties
in the trust?  I don't think so.  

 

It's all community property, and they have a community property agreement.
Is this advisable or necessary to have a CPA in this situation?

 

So, my questions are:

 

Can an LLC hold title to a mortgaged property?

Can a trust hold title to a mortgaged property?

Can an LLC holding title to a mortgaged property be held in trust?

Would it be necessary or possible to create new trusts to hold title to
mortgage property?

 

If the mortgaged property cannot be held by the trust, what advise do you
have about how to create a good estate plan for them?

 

Thank you for any insight you can give me.  I may be asking the entirely
wrong questions!!

 

Susan

 

SUSAN DONAHUE

Law Office of Susan Donahue

125 West 2nd Avenue, Suite "B"

P.O. Box 81

Twisp, WA 98856

(509) 996-5944 (phone)

(509) 362-9692 (fax)

 <mailto:sdonahue at sdonahuelaw.com> sdonahue at sdonahuelaw.com

 

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