Hatfield, PA · Member since 2012 · 1k+ posts · 629 votes
I am buying a multifamily in a state with high (franchise, etc.) taxes when entity owned but not individually owned. So I will put this one in my name rather than an LLC. And getting strong insurance. But there is that nagging concern about liability that an LLC helps shield.
My idea - sign contracts with tenants having an LLC as property management company, but property is in my personal name...
Investor · Dallas, TX · Member since 2009 · 718 posts · 913 votes
14y
I agree with everything said above. I'm a lawyer and I do a lot of plaintiff's work and I can promise you that if there is a lawsuit, owners, managers, everyone and their brothers will get named. Moreover, I'm not a huge believer that LLCs provide the protection people think they do. Even here in Texas it's not super hard to pierce them and/or tag the individuals, particularly if you (the individual) is actively participating in the management. A lot of insurance is the way to go in my opinion.
Lexington, KY · Member since 2009 · 2k+ posts · 1k+ votes
14y
Ken Latchers, I would talk to an attorney about this one. If you are concerned with liability a local real estate attorney will know what structure will provide the max protection. It may be well worth it to pay high fees to avoid larger issues that could come up .
Full-Time Investor · Charlotte, NC · Member since 2009 · 2k+ posts · 1k+ votes
14y
i'd speak with an attorney as well..for what it's worth though, when a tenant sues a property manager, the owner gets named on the suit as well..so your personal name may be included in a lawsuit anyways..i've heard of people having one LLC own and another manage the property
Investor · Dallas, TX · Member since 2009 · 718 posts · 913 votes
14y
I agree with everything said above. I'm a lawyer and I do a lot of plaintiff's work and I can promise you that if there is a lawsuit, owners, managers, everyone and their brothers will get named. Moreover, I'm not a huge believer that LLCs provide the protection people think they do. Even here in Texas it's not super hard to pierce them and/or tag the individuals, particularly if you (the individual) is actively participating in the management. A lot of insurance is the way to go in my opinion.
Investor, Entrepreneur, Educator · Springfield, MO · Member since 2009 · 21k+ posts · 12k+ votes
14y
Agreed, your best defense as a landlord to liability is keeping your property up, safe and make repairs promptly. Deal fairly but firmly with others....just limit the excuses for someone to go after you. And get insurance!