Starting an LLC - who you gonna call?

Question

I have heard it is best to purchase properties through an LLC.  Some quick searching suggests setting this up in Wyoming or Nevada is a good idea.  Is this true and if so, who are good folks to call in order to get started?

Jerry W. · Answer

@Scott Garrels if you just need to create the LLC and do not need the legal advice or operating agreements drawn up, there are literally hundreds of places who create them for you cheaply, and they serve as your registered agent as well.  I mean cheap like $50 or $100, over the filing fees.

Kerry Baird · Answer

My LLCs are set up in the same two States in which we have properties. One lawyer set them up in TX, and another lawyer set up our FL LLC in FL. We have used a portfolio lender for financing.

Bill S. · Answer

@Scott Garrels so not everyone agrees with the results of your "quick searching" in that it's not always "best" to purchase properties through an LLC. Financing in LLCs is a challenge. I would suggest you do some more learning on the topic. There are probably over 10,000 posts on the topic on this site alone. Once you dig in a bit you can see which folks follow your line of thinking. As you build connections you will get an answer to your question FOR YOU.

Scott Garrels · Answer

@Nate Marshall Thanks again for the insights here that you have provided.  I do get how this structure provides the benefits you describe here.  It also makes sense for me to organize the various companies in this manner.  I come from an aviation company background and they utilize a similar structure for the various businesses they have as well.

Happy Labor Day to you!

Nate Marshall · Answer

@Scott Garrels

Reduced liability from one property to the next. If someone slips and falls at property 38 it doesn't affect the others. He also runs maintenance from his GC and Maintenance company, billing and purchasing from his financial services company and coordinates Property Management and leasing from that entity. The holding company owns the properties.

Scott Garrels · Answer

@Nate Marshall Thanks again Nate, this is really good insight.

So this set up has the functional groups separated out to isolate each into their own LLC.  I assume this provides limited risk for each area somehow, correct?  5 total LLCs based upon this structure, if I understand correctly.

Scott Garrels · Answer

@Kerry Baird Thank you for your reply here.  So does this set up provide specific benefits simply because of where your properties are located OR does it bring in others as well?  I know it may seem elementary to you perhaps, but I am wondering why you could not set up one in TX and hold both TX and FL properties there for example?

Nate Marshall · Answer

@Scott Garrels

My understanding is that it resembles an org chart. The services entities are separate from the properties which are managed by holding company. The holding and service companies are owned by the master LLC.

Finance pays all of the bills. collects rents etc.

GC manages repairs and maintenance.

He has a property management company.

Holding Company

Main LLC.

Scott Garrels · Answer

@Nate Marshall Interesting indeed!  Are teh 42 for the properties considered "child" or "satellite" LLCs?

I would be interested in understanding the benefits this structure provides.  Thanks again for the info Nate.

Nate Marshall · Answer

@Scott Garrels Not sure on that. I am transferring mine to Wyoming.

I have a friend who has 46 LLC's for his real estate business. Main LLC, Holding Company, GC, Financial and 42 for eachof his properties.

Starting an LLC - who you gonna call?

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