Should I get an LLC on a property that I’m househacking

6 Replies

Hello BiggerPockets! I just purchased my first multi-family house which I will be house-hacking. It was a long journey but I’m the first step to investing is done. My question is should I get an LLC if I’m living in the property and is the benefit of an LLC. Any advice is appreciated! Thank you!

you cant, changes the loan to commercial

It would be convenient, but no. Not for FHA loans. However, I still highly recommend forming an LLC before your next investment.

LLCs make things difficult, much the same protection can be had by umbrella insurance. Plus, lot of people don't realize the level of effort needed to ensure they operate the LLC in a way that protects them.

I highly agree with @Matt K. . Many people end up mixing personal and LLC means of accounting, making it completely useless. Do your studying and consult with both an accountant and lawyer before forming one.

Originally posted by @Yasmin Mohamed :

I didn't know that forming an LLC would effect my loan. Great to know!

Forming the LLC in itself does nothing to your loan. The potential issues come when you convey the property from yourself to the LLC and potentially triggering the much talked about due on sale clause

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