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Loren
Loren, Attorney
Category: Legal
Satisfied Customers: 29102
Experience:  30 years experience representing clients.
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I bought a condo 3 years ago which I live in but also use as

Customer Question

I bought a condo 3 years ago which I live in but also use as an art studio. I've been thinking about incorporating my art business. I'm wondering if I can put the condo under the corporation in order to protect my personal credit status in case of foreclosure. The condo complex is going through some major renovations which could end up costing more than I can afford so the potential is there for me to lose the condo. If the condo was owned by the corporation would it protect my personal credit rating?
Submitted: 1 year ago.
Category: Legal
Expert:  Loren replied 1 year ago.

Good morning. I am Loren, a licensed attorney, and I look forward to assisting you today.

Expert:  Loren replied 1 year ago.

Is there currently a mortgage on the property or is it owned free and clear?

Expert:  Loren replied 1 year ago.

Are you online with me?

Expert:  Loren replied 1 year ago.

Is there currently a mortgage on the property or is it owned free and clear?

Customer: replied 1 year ago.
There is currently a mortgage.
Expert:  Loren replied 1 year ago.

Thank your for the additional information.

Expert:  Loren replied 1 year ago.

In theory it would shield you from personal liability if your condo were owned in a corporate entity.

Expert:  Loren replied 1 year ago.

However, in practice it is not likely to work and I will explain why.

Customer: replied 1 year ago.
OK, can you explain for the money I've already paid?
Expert:  Loren replied 1 year ago.

All mortgages contain a due on transfer clause which would require that you obtain the consent of the lender or pay off the balance owed before you change the title.

Expert:  Loren replied 1 year ago.

Even if they did allow the corporation to hold title they will assuredly want a personal guarantee from you, which would appear on your credit report and render you personally liable for default.

Expert:  Loren replied 1 year ago.

Did you have further questions? Have I answered your question?

Expert:  Loren replied 1 year ago.

Are you still online with me?

Expert:  Loren replied 1 year ago.

Have I answered your question?

Expert:  Loren replied 1 year ago.

If you have no further questions, and have not yet done so, please remember to leave a favorable rating (Excellent or Good) so that I am credited for assisting you. A bonus is not required, but is always appreciated.

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