LLC?

If you are going to be in the rental business, I would definitely use an LLC. If you're going to flip, then I don't have strong thoughts one way or another (although I would use the LLC).

Mike

Edited: 06/26/2010 at 03:41AM

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Icon_minipost Jun 22 '07, 05:25 AM

Originally posted by "mrsg"

Hi All,
Is it better to start an LLC to begin investing or can one simply get business cards and go from there?

It is not about business cards.

An LLC is a tool to minimize the legals risks while not causing too many other problems.

If you have nothing to lose then having an LLC is not required. If you do have assets that could be lost in a lawsuit an LLC is part of a bigger process.

Business cards? I have not had them in years and I do fine when it comes to new business.

John Corey

Edited: 06/26/2010 at 03:41AM

Afsheen Akbar

· FL

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Icon_minipost Jun 23 '07, 08:43 AM

Mike,
Would you say that having an LLC for the rental business is a requirement or something you should do to be on the safe side? I think what I am confused about is if you wanna just get a house and rent in (in addition to having your own place) do you have to have an LLC? Do you also have to have some kind of license?
Thanks
Afsheen

Edited: 06/26/2010 at 03:41AM

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Icon_minipost Jun 23 '07, 03:54 PM

I will leave the LLC aspect of the question for MikeOH to address.

A license is a very local matter. Your city is normally the one who sets licensing standards.

At the state level there are restrictions on being a property manager for a property you do not own. Other than that there are normally no state level licenses. Just regulations to follow.

Check online with you local city, county and state. Consider joining the local apartment owners association for your state as they will generally be on top of all the rules, reg's and license issues that will apply.

John Corey

Edited: 06/26/2010 at 03:41AM

Peter Stewart

Residential Real Estate Broker · Alabama

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Icon_minipost Jun 24 '07, 10:50 AM

Originally posted by "REI"

Consider joining the local apartment owners association for your state as they will generally be on top of all the rules, reg's and license issues that will apply.

John Corey

Where can I find the local appartment owners association for Portland, OR??? Could you PM me the details.

- Peter

Edited: 06/26/2010 at 03:41AM

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Icon_minipost Jun 24 '07, 02:07 PM

Peter,

They used to have an office in Lake Oswego just off of I-5 at 205.

Try google and you will find a couple of hits as there are two organizations the last time I looked.

There is also a national organization so you can get local details there.

Do you know about the NWREII group? They run local investor meetings in the metro Portland area. Another resource who will have info or contacts at different associations.

John Corey

Edited: 06/26/2010 at 03:41AM

Michael Rossi

Real Estate Investor · Ohio

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Icon_minipost Jun 24 '07, 07:10 PM

AA,

No, you are not ever REQUIRED to have a LLC. If you plan to only have one or two rentals and don't have a lot of other assets, then you might just buy them in your own name and have liability insurance on them.

If your plan is to build a significant rental property business, then I would buy all the properties in LLCs.

Mike

Edited: 06/26/2010 at 03:41AM

Peter Stewart

Residential Real Estate Broker · Alabama

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Icon_minipost Jun 24 '07, 08:33 PM

Originally posted by "REI"

Try google and you will find a couple of hits as there are two organizations the last time I looked.

Do you know about the NWREII group?

John Corey

John -
Thanks for the help. I have attended one NWREII meeting but haven't been able to find their site until now.
____________________

Sorry about the thread hijack... Back to the LLC discussion.

Edited: 06/26/2010 at 03:41AM

Robin Vidovich

Real Estate Investor · Reading, Pennsylvania

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Icon_minipost Jun 25 '07, 12:28 AM

Try to find a lawyer who specilizes in real estate and or has his CPA. He/She will be able to help you assess your liablilties for the type of investing you want to do.

Edited: 06/26/2010 at 03:41AM

Peter Stewart

Residential Real Estate Broker · Alabama

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Icon_minipost Jun 25 '07, 12:37 AM

Originally posted by "rdinvestors"

Try to find a lawyer who specilizes in real estate and or has his CPA. He/She will be able to help you assess your liablilties for the type of investing you want to do.

That's good advice.

The investors I've talked with said to plan on forming an LLC or another legal entity (depending on your situation) but don't worry about it for your first property. The idea.... yes, you should do it.... no, it should not stop you from buying your first property.

Edited: 06/26/2010 at 03:42AM

Robin Vidovich

Real Estate Investor · Reading, Pennsylvania

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Icon_minipost Jun 25 '07, 12:43 AM

My understanding is that an LLC forms another layer of protection for your personal assets. If you do buy a property without LLC protection as stated in an eatlier post, make sure that you buy additional insurance for the property.

Edited: 06/26/2010 at 03:42AM