LLC or Umbrella liability policy?

[Caleb Thompson]

I know versions of this question have been answered, but as a new investor, is it most conducive to keep my first rental property in my own name and look into an umbrella excess policy (1-2 mil limits)? Or, look into spending money on an LLC? The property is in my name and It's to my understanding lenders can be apprehensive about the title of the property being transferred to an LLC.

Open to thoughts, opinions, and any stories!

thank you

[Ghassan Jabali]

Hello Caleb,

I hope you're doing well. Insurance is always a great first line of defense with an umbrella policy being a great way to protect in case anything unfortunate were to happen. However, lots of investors still chose to organize an LLC and put property into it with some type of asset protection structure, even for 1 or 2 properties. With my own personal investing, I have my rental property inside a business structure to provide anonymity and asset protection, along with insurance to protect my businesses from one another, my business from any personal liability, and any personal liability from going after me personally. I do like to recommend both as the best practice and if finances allow it.

Note: This information is for educational and informational purposes only and does not constitute legal, tax, financial, or investment advice. No attorney-client, fiduciary, or professional relationship is established through this communication.