[WSBAPT] Deeding rental property to Rev Living Trust

[Nick Pleasants]

I was thinking about this a little over the weekend, and recalled seeing a case that stood for the proposition that there is no occupancy requirement to Garn St Germain. It's an unpublished case, and there are not many published cases on Garn St Germain, which tells you this is a bit of the wild west. The attached handout from WealthCounsel discusses the issue of whether to inform the lender.
Best,
Nick

From: wsbapt-bounces at lists.wsbarppt.com <wsbapt-bounces at lists.wsbarppt.com> On Behalf Of Philip N. Jones
Sent: Saturday, December 17, 2022 9:20 AM
To: WSBA Probate & Trust Listserv <wsbapt at lists.wsbarppt.com>
Subject: Re: [WSBAPT] Deeding rental property to Rev Living Trust

I have never sought permission, and never had a problem.
Phil Jones

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From: wsbapt-bounces at lists.wsbarppt.com<mailto:wsbapt-bounces at lists.wsbarppt.com> <wsbapt-bounces at lists.wsbarppt.com<mailto:wsbapt-bounces at lists.wsbarppt.com>> on behalf of Nick Pleasants <npleasants at ohswlaw.com<mailto:npleasants at ohswlaw.com>>
Sent: Friday, December 16, 2022 2:08:45 PM
To: WSBA Probate & Trust Listserv <wsbapt at lists.wsbarppt.com<mailto:wsbapt at lists.wsbarppt.com>>
Subject: Re: [WSBAPT] Deeding rental property to Rev Living Trust


I don't see anything in the statute I referenced that refers to whether the borrower is residing in the property. So the fact that it is currently rented out should not impact the applicability of the preemption.



From: wsbapt-bounces at lists.wsbarppt.com<mailto:wsbapt-bounces at lists.wsbarppt.com> <wsbapt-bounces at lists.wsbarppt.com<mailto:wsbapt-bounces at lists.wsbarppt.com>> On Behalf Of Ann Manley
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To: WSBA Probate & Trust Listserv <wsbapt at lists.wsbarppt.com<mailto:wsbapt at lists.wsbarppt.com>>
Subject: Re: [WSBAPT] Deeding rental property to Rev Living Trust



So you don't get the mortgage company's permission even if the borrowers don't currently reside in the property?


Ann Manley, Esq.

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On Fri, Dec 16, 2022 at 1:49 PM Nick Pleasants <npleasants at ohswlaw.com<mailto:npleasants at ohswlaw.com>> wrote:

No permission needed. The mortgage company is preempted from taking action on a transfer to an inter vivos trust where the borrower is beneficiary and retains the right to live. 12 USC § 1701j-3<https://nam11.safelinks.protection.outlook.com/?url=https%3A%2F%2Fwww.law.cornell.edu%2Fuscode%2Ftext%2F12%2F1701j-3&data=05%7C01%7Cpjones%40duffykekel.com%7C5195a5009f834d5f6d1f08dadfb27bdb%7C2d66ed5354fa4c2f8c4dbff1aca5479d%7C0%7C0%7C638068254930899865%7CUnknown%7CTWFpbGZsb3d8eyJWIjoiMC4wLjAwMDAiLCJQIjoiV2luMzIiLCJBTiI6Ik1haWwiLCJXVCI6Mn0%3D%7C2000%7C%7C%7C&sdata=tJFob1GJodYnOOpUmaQh3JRiHjTVpzxJTzc8Y5FKHxc%3D&reserved=0>(d)(8). We very rarely notify the mortgage holder.

If you transfer a mortgaged property to an LLC, that is a different animal, and I might advise obtaining the lender's permission prior to the transfer. And you need to add LLC as named insured on the P&C insurance prior to recording the deed.



Nicholas Pleasants | Shareholder



[OseranHahnAttyatLaw 8]



11225 SE 6th Street | Suite 100 | Bellevue, WA 98004
Main: (425) 455-3900 | Fax: (425) 455-9201 | E-mail: npleasants at ohswlaw.com<mailto:npleasants at ohswlaw.com>



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Subject: [WSBAPT] Deeding rental property to Rev Living Trust



It's advisable to get permission from a mortgage co. before transferring non-primary residence property to a RLT, right? Has anyone had the experience where the mortgage co. doesn't give permission? What would happen if you transferred the property without getting permission ahead of time?


Ann Manley, Esq.

The Manley Law Firm, P.S., Inc.

PO Box 16324

Seattle, WA 98116

(206)292-3064 / (206)292-3914 fax

www.manleyfirm.com<https://nam11.safelinks.protection.outlook.com/?url=http%3A%2F%2Fwww.manleyfirm.com%2F&data=05%7C01%7Cpjones%40duffykekel.com%7C5195a5009f834d5f6d1f08dadfb27bdb%7C2d66ed5354fa4c2f8c4dbff1aca5479d%7C0%7C0%7C638068254930899865%7CUnknown%7CTWFpbGZsb3d8eyJWIjoiMC4wLjAwMDAiLCJQIjoiV2luMzIiLCJBTiI6Ik1haWwiLCJXVCI6Mn0%3D%7C2000%7C%7C%7C&sdata=YbvFZBmStnNvN%2F5Yv8mFgt7RvF5UJ0eENeL3XBH8ZY4%3D&reserved=0>

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