🏘️ Just Transferred Your Rental to an LLC? Here’s What to Do Next.
By Mike Massey Law, PLLC – Real Estate + Asset Protection Attorneys
So you’ve successfully deeded your rental property to your LLC—a smart move for liability protection. But you’re not done yet.
To avoid headaches down the road (and to preserve your asset protection), you’ll need to update a few important documents and policies. Here’s a quick checklist of what to do after the deed is recorded.
✅ 1. Update Your Property Insurance Policy
Once the LLC owns the property, the LLC must be listed as the named insured on your homeowner’s or landlord insurance policy.
Also:
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If your name is still on the mortgage, add yourself as an “additional insured” or “interested party”
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Make sure the coverage is appropriate for rental use, not personal residence
📌 Failure to update could result in a denied claim—especially if the insurer finds out after a fire, flood, or lawsuit.
✅ 2. Review or Update Your Title Insurance
Your existing title insurance policy is likely in your personal name. Some insurers offer an endorsement or assignment to carry it over to the LLC.
Ask your title company or real estate attorney:
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Can the policy be amended?
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Is a new title policy required for the LLC?
✅ 3. Amend or Redraft Your Lease Agreements
Your lease should now reflect the LLC as the landlord. Update:
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The landlord’s legal name
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Payment instructions (LLC’s bank account)
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Notices and contact info
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Security deposit clauses (held in LLC name)
One detail this checklist item glosses over: simply updating the lease language doesn’t automatically shift legal responsibility for deposits already collected. Under Texas Property Code § 92.105, liability for a tenant’s security deposit transfers to the new owner (your LLC) as of the date title actually transfers — but you, as the prior owner, remain personally liable for that deposit until the LLC actually receives it or formally assumes the obligation in writing. Texas law also requires the new owner to give each tenant a signed statement confirming the deposit amount (§92.105(b)) — don’t skip this, since it’s the one piece of this step that’s an actual statutory requirement, not just good practice.
If you’re using a property manager, make sure they have the updated lease template and the LLC’s entity documents on file.
✅ 4. Get an LLC Bank Account
Keep property finances completely separate. Use an LLC-only bank account for:
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Rent payments
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Repairs
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Mortgage (if still in your name, reimburse via formal process)
Mixing personal and LLC finances is a surefire way to lose liability protection in court (piercing the corporate veil).
💡 Bonus: Add the Property to Your Estate Plan
Now that your property is owned by an LLC, make sure your revocable living trust or succession plan reflects:
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Who inherits the LLC
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Who controls it if you pass away or become incapacitated
🗂️ In Summary: Post-Transfer To-Do List
✅ Update homeowner’s or landlord insurance
✅ Review or amend title insurance
✅ Update leases to reflect LLC ownership
✅ Open and use an LLC bank account
✅ Check city/county compliance rules
✅ Update your estate plan to include the LLC
FAQs
Q: Am I still responsible for my tenant’s security deposit after I transfer the property to my LLC?
A: Yes, until the LLC actually receives the deposit or formally assumes responsibility for it in writing — Texas Property Code § 92.105 keeps the prior owner liable until that handoff happens, not just until the deed records.
Q: Do I legally have to notify my tenant about the ownership change?
A: Texas Property Code § 92.105(b) specifically requires the new owner to give tenants a signed statement confirming the deposit amount. Beyond that legal minimum, notifying tenants of the new payee is simply necessary to avoid rent being sent to the wrong party.
📅 Need Help Finalizing Your Rental Transfer?
We help landlords and real estate investors in Texas every day—from deed prep to LLC formation to post-transfer cleanup.
📞 Book your free consultation today:
👉 https://mytxwills.com/book-a-meeting/
About the Attorney: This article is written by Mike Massey, JD, MBA, MPA, founder of Mike Massey Law and a licensed attorney with the State Bar of Texas. Mike Massey Law guides Texas real estate investors through the full lifecycle of LLC asset protection — from the initial transfer through the operational details that follow it.
📜 Disclaimer
This blog post is for informational purposes only and does not constitute legal advice. Reading this post does not create an attorney-client relationship with Mike Massey Law, PLLC. Please consult a licensed attorney for personalized legal guidance.
Last Updated: Oct 2026
