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<p class="MsoNormal"><span style="color:#002060">Dear Listmates:<o:p></o:p></span></p>
<p class="MsoNormal"><span style="color:#002060"><o:p> </o:p></span></p>
<p class="MsoNormal"><span style="color:#002060">Client wants to transfer title to property with a house in which she lives to her Trust. The property is encumbered by a deed of trust that has a due on sale clause. 12 CFR § 191.5 prohibits a lender from exercising
its option pursuant to a due on sale clause where the transfer is "into an inter vivos trust in which the borrower is and remains the beneficiary and occupant of the property…." Besides meeting these criteria, do any of you have any tips or comments about
relying on this prohibition before quitclaiming the property into the Trust?<o:p></o:p></span></p>
<p class="MsoNormal"><span style="color:#002060"><o:p> </o:p></span></p>
<p class="MsoNormal"><span style="color:#002060">That CFR also gives the following exception to the prohibition:
<o:p></o:p></span></p>
<p class="MsoNormal" style="margin-left:.5in"><span style="color:#002060">“… unless, as a condition precedent to such transfer, the borrower refuses to provide the lender with reasonable means acceptable to the lender by which the lender will be assured of
timely notice of any subsequent transfer of the beneficial interest or change in occupancy.”
<o:p></o:p></span></p>
<p class="MsoNormal"><span style="color:#002060">Does anyone know how such a “condition precedent” would arise? Or is this saying that the condition precedent to the prohibition is the borrower’s offer of “reasonable means acceptable to the lender” This would
still seem to require the lender to give permission for the transfer. <o:p></o:p></span></p>
<p class="MsoNormal"><span style="color:#002060"><o:p> </o:p></span></p>
<p class="MsoNormal"><span style="color:#002060">Thanks in advance.<o:p></o:p></span></p>
<p class="MsoNormal"><span style="color:#002060"><o:p> </o:p></span></p>
<p class="MsoNormal" style="margin-bottom:12.0pt"><b>Mark B. Anderson<br>
</b>ANDERSON LAW FIRM PLLC<br>
821 Dock St Ste 209 PMB 4-12<br>
Tacoma, Washington 98402<br>
+1 253-327-1750<br>
+1 253-327-1751 (fax)<br>
<a href="mailto:marka@mbaesq.com"><span style="color:blue">marka@mbaesq.com</span></a><br>
<a href="http://www.mbaesq.com/"><span style="color:blue">www.mbaesq.com</span></a><b><o:p></o:p></b></p>
<p class="MsoNormal" style="margin-bottom:12.0pt"><b><span style="font-family:"Arial Narrow",sans-serif;color:#002060">CONFIDENTIALITY NOTICE<br>
</span></b><span style="font-family:"Arial Narrow",sans-serif;color:#002060">This transmission is confidential and is intended solely for the use of the individual named recipient. It may be protected by the attorney-client privilege, work product doctrine,
or other confidentiality protection. If you are not the intended recipient, or the person responsible to deliver it to the intended recipient, be advised that any dissemination, distribution, or copying of this communication is prohibited. If you have received
this transmission in error, please immediately notify the sender via e-mail or by telephone at (253) 327-1750 that you have received the message in error, and then delete it. Thank you.</span><span style="font-size:7.5pt;color:#002060"><o:p></o:p></span></p>
<p class="MsoNormal"><o:p> </o:p></p>
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