Initial Steps

• 1). Determine whether or not your lender will permit transfer of your residence to a standalone LLC. With some mortgages, especially older ones, a transfer from personal ownership to an LLC is viewed as a sale of the property. In that case, your mortgage holder may trigger a due on sale clause and demand immediate payment of the mortgage balance. However, many mortgage companies are becoming educated on this process and will permit the transfer because you remain personally liable for the balance of the mortgage. If you've paid off your mortgage, there's no restriction whatsoever on making this transfer.
  
  
• 2). Decide whether to use an attorney or a legal document service such as LegalZoom or Rocket Lawyer. A legal document service can, in some cases, be less expensive than an attorney, but you'll have to do all the work on your own.
  
  
• 3). Decide in which state to organize your LLC. Generally, you'll organize and file paperwork establishing it in the state in which your residence is located, but some states only permit LLCs to organize for business purposes. If this is the case in your state, you must select a state, such as Ohio or Delaware, that permits the organization of LLCs "for any legal purpose."
  
  
• 4). Select a name for your personal residence LLC and file your paperwork with the appropriate state office. You'll be required to choose a name that's easily distinguishable from other LLCs.
  
  
• 5). Wait until your paperwork has been approved and you receive a copy from the state office. If you organized your LLC in another state, you'll need to license this out-of-state LLC to operate in your home state. You license an out-of-state LLC by filing simple paperwork with your state office that registers companies.
  
  

Final Steps

• 1). Transfer the deed for your personal residence to your new LLC. Typically, you'll need to pay several transfer fees and get approval from your local county auditor and county engineer. Your deed is typically then filed with your local county recorder.
  
  
• 2). Obtain a tax identification number from the Internal Revenue Service. This number will be used to set up a new bank account in the name of the LLC.
  
  
• 3). Set up a bank account in the name of the LLC. You'll use this new account to pay your mortgage if you still have one, pay your taxes on the home, and pay your other home-related bills such as utilities.
  
  
• 4). Transfer your utilities. Your utilities should be transferred into the name of the LLC, out of your personal name. This step helps to show that the LLC truly owns the property and the transfer was not a sham transaction.
  
  
• 5). Transfer your home insurance. Your home insurance should be transferred into the name of the LLC because it's now the true owner of the property.