Rental Property Investor · Hastings, NE · Member since 2018 · 57 posts · 53 votes
I am just looking to get started. I have read a good deal and many sources say to hold property in the name of an LCC. When I have spoken with lenders they say I can not do that. Perhaps it is because I am new or perhaps it is because the LLC I have not created yet has no financial history. My questions are these:
Should I just buy a property in my name and self-manage it under my name?
Should I explore getting a mortgage in the name of an LCC - perhaps I just have not spoken to enough lenders. I have the capital to easily put 20-25% down on the properties I have been looking at. I do not have the money to buy 100% cash so I will need some financing.
If I own the property in my name should I create an LLC to manage the property?
My goal is to buy and hold several properties over the next few years. Ideally I would like to get to 10 smaller single family homes in the next 5 years. Obviously, time and experience could modify this.
Hey Most residential lenders don't make loans in the name of LLC. Which is why you are having a hard time.
If it is your first property and you are not looking to do a flip, it is not worth trying to necessarily get the loan under an LLC.
Most first time real investors don't have much asset (if any) to protect to be hugely concerned about the liabilities of owning real estates.
When you get to a point where you have a lot of assets or significants to protect, you should start to seriously or solely considered doing it under an LLC.
Scott Trench wrote a great article, take a look at it.