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  Case Study: The Surprise of Pennsylvania Transfer Tax at Closing Loan 1340

  Posted by Nadlan Group on June 12 at 22:43

  📌 Case Study: The Surprise of Pennsylvania Transfer Tax at Closing
  Loan 1340 – Admon | Refinance with Cash Out | 1A – Pennsylvania | Lender ID 2467

  🔁 Background
  Admon was finalizing a refinance with cash out for his property in Pennsylvania. As part of the closing, the deed was being transferred from his personal name to his 100% owned LLC.

  Just before funding, he was shocked to see a $6,185.75 transfer tax charged on the HUD.

  ⚖️ Why the Surprise?
  Admon correctly referenced PA Code – Title 61, Chapter 91.193(b), which states:

  “A transfer for no or nominal actual consideration between an individual and a wholly owned entity”
  is exempt from realty transfer tax.

  However, the county title office refused to record the deed without transfer tax, even though this should be a valid exemption.

  📝 The borrower even cited Form REV-183EX (Statement of Value) as justification.

  🔍 What Went Wrong?

  • Some PA counties don’t automatically honor the exemption unless very specific documentation is pre-approved.
  • Title companies often default to collecting the tax to avoid recording rejection.
  • Lenders don’t accept delays, so the borrower had to choose: pay now and request refund later or delay closing.

  📚 Key Lessons:

  ✅ Always discuss PA deed transfer strategy before closing.
  ✅ Provide Form REV-183EX and exemption clause up front.
  ✅ Confirm with the local title office — not just the title company.
  ✅ PA often requires actual evidence of ownership & proof of “nominal consideration.”
  ✅ Budget for transfer tax even if exemption might apply — to avoid surprises.

  🛠️ Need help with Pennsylvania closings or entity structuring?
  We help clients avoid costly delays by preparing docs, deeds, and legal paths in advance.

  📲 http://www.NadlanCapitalGroup.com

  #PennsylvaniaRealEstate #RefinanceCaseStudy #TransferTax #DSCRLoan #EntityTransfer #LLCRefinance #RealEstateInvesting #NadlanCapitalGroup

  Nadlan Group replied 1 month ago 1 Member · 0 Replies

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