How to Use Your Business to Shield Your Home

Michael Wedaa
Aug 3
3 min read

You worked your ass off for your home. Don’t let some ambulance chaser with a judgment take it.

You’ve probably heard that forming a corporation or LLC helps protect your personal assets when your business gets sued. Cool. But let’s flip that script: what if you get sued personally—like from a car accident, a pissed-off neighbor, or an old business partner looking for revenge? What then? They’re coming for your house. Specifically, the equity in your house. That juicy, delicious equity is a target—and lawsuits are the arrows aimed right at it.

Enter: Equity Stripping

This isn’t some exotic dance move in a dimly lit bar. This is a strategic legal maneuver to make your property look broke, even if it's loaded. Equity stripping means placing a lien against your own property, so that there’s no juicy equity left for predators to come after. You’re not selling the property—you’re just locking it up with a claim from someone you trust: your own corporation or LLC. When a bank gives you a loan, it places a lien on your house so that the bank gets paid before anyone else. But here’s the play: you don’t need a bank. You can create your own lien using your own company.

How It Works:

Your corporation "loans" you money.
You sign a legit promissory note (yes, make it a real loan—it needs to hold up in court).
Your company records a lien against your house for the amount of the loan.
Voilà. Your home equity is now locked up and no longer as attractive to a hungry creditor.

It’s priority debt that comes before any creditor or judgment. That makes lawyers think twice before going after you, because there’s less available for them to take.

Let’s Talk Numbers (Because That’s Where the Magic Happens)

Let’s say your house is worth $750,000. Here’s how you armor up:

$450,000 first mortgage (bank’s lien — normal stuff)
$300,000 second lien from Your Corp, Inc.
$50,000 lawsuit judgment (ouch, but too late)

Do the math: $450k + $300k = $750k. That’s all the equity in your house. Which means when you sell, guess who’s getting paid? The bank and your corp. And guess who’s getting stiffed? Captain Lawsuit. Cry harder.

Now let’s level up the game. If you think your home will appreciate (and it probably will), bump your corporate lien even higher:

$400,000 lien from your corp instead of $300k. Now, even if the value of your house goes up, no one else gets a piece unless you say so.

But Wait — Don’t Fake It. Here’s the part where you don’t get cute and screw it all up. Your business needs to actually lend you the money, or at least look like it did. That means:

Draft a real loan agreement
Include interest rate, repayment terms, due dates
Hold a board meeting and record minutes
Do not give yourself a zero-interest loan if you’re an owner or officer—that’s a red flag and the IRS has a nose for blood

Now, we get it—maybe your corp doesn’t have $300k chilling in a bank account. Some people try to slap a lien on the house anyway, even without moving money around. But beware: if someone starts digging and finds out the loan was smoke and mirrors, the lien will get thrown out. Poof—all that equity is exposed.

The solution: Build business credit and use it to create a real loan transaction. Advance money from the business credit line and run it as an actual, documented loan to yourself — paperwork, repayment terms, interest, the whole deal. Treat it like a real transaction, not a magic trick. Then, when the funds circle back into the business, it’s structured as a loan being repaid. In that setup, you’re not hiding assets — you’re positioning them, with a legitimate lender/borrower relationship and a secured interest that’s actually supported by documentation. Instead of pretending the business is untouchable, you’ve just changed who it answers to. You stop being the chump begging for protection and start acting like the one holding the note. Well done, Rogue.

Rogue Disclaimer:

This only works if it’s done right—with proper paperwork, a recorded lien, and a real loan agreement.
Don’t try this after you’ve already been sued (or even if a lawsuit is reasonably foreseeable)—that’s called fraudulent conveyance, and it’ll land you in even deeper trouble.
Timing is important. The older the lien, the better it looks. Implement now, long before there is trouble on the horizon to reduce fraudulent transfer risk.
Courts scrutinize insider loans, so be sure to follow the rules to the letter.
And no, this doesn’t eliminate the debt or make your problems disappear. It just helps to put your assets in a legal stronghold.