due of sale clause in existing mortgage agreement

I WOULD LIKE TO PU MY TWO INCOME PROPERTIES IN LLCS BUT MY MORTGAGE HOLDER SAYS THEY WOULD NOT GIVE PERMISSION WITHOUT ENFORCING THE DUE ON SALE CLAUSE. DO I HAVE ANY OPTIONS?
THANK YOU,
GEORGE R.

Answer

You'd have to have an attorney look at your state laws and the contract in question.

A mortgage is a contract, so the particular language in your contract is critical regarding the due on sale clause and whether transfer to an LLC is technically a "sale" (as defined by the contract).

If you can get hold of someone intelligent at your mortgage holder's institution who has authority, you might be able to explain your situation. The mortgage holder will want a personal guarantee of the mortgage from you (and your spouse, if any), and you should be ready to sign one if you expect cooperation from the mortgage holder.

Other than that, you can refinance, but obviously that's easier said than done in this economy.