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    derektor's Avatar
    derektor Posts: 1, Reputation: 1
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    #1

    Apr 19, 2012, 12:12 PM
    Lien or mortgage?
    I want to secure a loan against third parties for a loan I am giving to my son to buy and develop property in California. He is just starting his own business.
    The loan is without interest and installments, but is repayable on demand (with a reasonable period to execute).
    What is the best structure for the loan, mortgage or a lien against the property, or anything else? Should he make the property a LLC?
    We live outside of the USA and we do not want this transaction to create a tax issue in California for us.
    Thank you for your advice.
    AK lawyer's Avatar
    AK lawyer Posts: 12,592, Reputation: 977
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    #2

    Apr 19, 2012, 06:33 PM
    Quote Originally Posted by derektor View Post
    I want to secure a loan against third parties for a loan I am giving to my son to buy and develop property in California. He is just starting his own business.
    The loan is without interest and installments, but is repayable on demand (with a reasonable period to execute).
    What is the best structure for the loan, mortgage or a lien against the property, or anything else? Should he make the property a LLC?
    We live outside of the USA and we do not want this transaction to create a tax issue in California for us.
    Thank you for your advice.
    A mortgage is a type of a voluntary lien.

    One does not "make" property a LLC. A LLC is a business form, similar to a partnership.

    You would be an idiot if you try to set this up without seeking the guidance of an attorney on this transaction.
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