[FL] How do I transfer a mortgage into a trust?
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A few points based on what you told me:
Even though the LLC and trust are Florida entities, Colorado law governs recording and public notice because the property is in Colorado. So the assignment should be drafted and recorded in the Colorado county where the property is located (§ 38-35-109).
- Practical checklist:
• Prepare an Assignment of Mortgage/Note that clearly identifies the original mortgage and promissory note (dates, parties, recording info).
• Record the assignment in the Colorado county recorder’s office to put the world on notice of the new owner (your trust).
• Check the original mortgage and note for any “due-on-transfer” or acceleration clauses — even if the trust is the sole member of the LLC, review for potential triggers.
• Notify the borrower (if different from the LLC) of the assignment and provide payment/contact details for the trust. - Separately (to effect ownership changes and dissolution):
• Transfer your membership interest in the Florida LLC to your trust (use an Assignment of Membership Interest), follow the LLC operating agreement, and amend records as required.
• Update the LLC’s internal records and, if necessary, make any filings with Florida’s Sunbiz (check the operating agreement and Florida law).
• Do not dissolve the LLC until the assignment is completed and recorded and the LLC’s affairs are wound up (collect outstanding debts, pay liabilities, transfer assets to the trust).
• File Articles of Dissolution in Florida only after the LLC has transferred its assets and handled tax/final return obligations. Consult a tax professional about final filings and any tax consequences.
Bottom line — record the mortgage assignment in Colorado, document and record the membership transfer to the trust in Florida, then wind up and dissolve the LLC. I strongly recommend a local Florida business attorney and, if needed, Colorado recording counsel to ensure both the assignment and the LLC dissolution are done correctly.
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I am transferring a mortgage from a Florida LLC to a trust located in Florida also. The mortgage is for a property in Colorado that I sold through the LLC last month. Is there anything special that needs to be done with the assignment?
I understand the complexity. Have you already contacted the mortgage lender about the transfer from the Florida LLC to the trust?
No — the Florida LLC is the lender and is assigning the note to the trust in Florida.
Are both the Florida LLC and the trust properly registered and in good standing?
Yes.
Anything else the real estate lawyer should know before I connect you?
That is about it.
Hi — I’m Jon, a licensed attorney with over 13 years of experience, and I'm here to help. I'll do my best to make things clear and provide you with the guidance you need.
Hi.
A few points based on what you told me:
Even though the LLC and trust are Florida entities, Colorado law governs recording and public notice because the property is in Colorado. So the assignment should be drafted and recorded in the Colorado county where the property is located (§ 38-35-109).
- Practical checklist:
• Prepare an Assignment of Mortgage/Note that clearly identifies the original mortgage and promissory note (dates, parties, recording info).
• Record the assignment in the Colorado county recorder’s office to put the world on notice of the new owner (your trust).
• Check the original mortgage and note for any “due-on-transfer” or acceleration clauses — even if the trust is the sole member of the LLC, review for potential triggers.
• Notify the borrower (if different from the LLC) of the assignment and provide payment/contact details for the trust. - Separately (to effect ownership changes and dissolution):
• Transfer your membership interest in the Florida LLC to your trust (use an Assignment of Membership Interest), follow the LLC operating agreement, and amend records as required.
• Update the LLC’s internal records and, if necessary, make any filings with Florida’s Sunbiz (check the operating agreement and Florida law).
• Do not dissolve the LLC until the assignment is completed and recorded and the LLC’s affairs are wound up (collect outstanding debts, pay liabilities, transfer assets to the trust).
• File Articles of Dissolution in Florida only after the LLC has transferred its assets and handled tax/final return obligations. Consult a tax professional about final filings and any tax consequences.
Bottom line — record the mortgage assignment in Colorado, document and record the membership transfer to the trust in Florida, then wind up and dissolve the LLC. I strongly recommend a local Florida business attorney and, if needed, Colorado recording counsel to ensure both the assignment and the LLC dissolution are done correctly.
Thank you.
You’re welcome — glad it helped.
