Bob Kutschbach, owner and broker of Carleton Realty, discusses the importance of paperwork and the true identity of the seller.
Many times we talk to people that want to sell their homes. They list it in their name and we discover that the property is actually held in a trust, LLC, or corporation. It is essential to realize that a person themselves cannot sell a property that is held by one of these other types of entities. A trust, LLC, or corporation must sell it and the owner will be the authorized signer.
An example: a homeowner has put their home in an LLC for some sort of legal protection against lawsuits or other liabilities. This is not a bad idea and attorneys must be involved, but it can successfully protect you from liability. The problem is that you can’t sell the property in your own name, you must sell it in the name of the LLC with you listed as the managing member. With a corporation, there needs to be a corporate resolution authorizing the president or owner to sell the home. Same with a trust, the property must be sold by the trustee.
It is imperative that all documents in the real estate transaction be filled out correctly in the name of the deed holder. Otherwise, the property is not being sold legally and there could be ramifications where people could come back and say that the owner did not give a clear title because the title was not signed by the legal owner. This is why it is important for real estate agents to check carefully to see who is the true and lawful owner on the public records.
If you have questions about selling a home that is held in a trust, LLC, or corporation please reach out to one of our agents!