If the mortgage is still in mine name, are my personal assets protected if a condo guest decides to sue me?
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If the mortgage is still in mine name, are my personal assets protected if a condo guest decides to sue me?
I converted my condo to a weekly vacation rental and am currently operating as a sole proprietor. I’m worried about my personal assets exposure and liability from guests and would like to create an LLC. I plan to change the insurance to the LLC. I plan to quick claim the condo deed to the LLC. I can’t refinance, so I have no way to get the mortgage out of my name.
Asked on October 18, 2011 under Real Estate Law, Montana
Answers:
FreeAdvice Contributing Attorney / FreeAdvice Contributing Attorney
Answered 13 years ago | Contributor
Whether or not the mortgage concerning the condominium that you wish to transfer into the name of a limited liability company for business purposes is in your name or not will have no impact upon you personally for any liability concerning the structure that you want to use for rental purposes.
The key is to transfer title into the name of a registered limited liability company, keep your own personal assets separate and apart from the limited liability company, and have adequate insurance for this venture in the entity's name. You will need to transfer title of the property into the name of this entity as well and hold regular meetings as to it concerning the organizational documents for it.
Good luck.
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