This CLE program explores the intersection of estate planning and real estate law, focusing on the implications of the due-on-sale clause in the context of transferring real property to revocable trusts, irrevocable trusts, and limited liability companies (LLCs). The due-on-sale clause—commonly found in mortgage contracts—can trigger loan acceleration when ownership of the secured property is transferred. However, federal law (notably the Garn-St. Germain Depository Institutions Act of 1982) provides certain exceptions, as to servicer guidelines (Fannie Mae, Freddie Mac) Estate planning attorneys must understand when such transfers are permissible without lender consent, and when they may pose risks to clients.

This course will cover the legal foundation and purpose of due-on-sale clauses, key provisions of the Garn-St. Germain Act and its safe harbors, transfers to revocable trusts, irrevocable trusts, LLCs, how and when the due-on-sale clause may be triggered, and practical guidance for advising clients on the risks of transferring encumbered real estate for estate planning purposes.