Twinsburg, OH · Member since 2014 · 37 posts · 9 votes
Good morning everyone. This is my second single family home. I am in process of signing lease. I do have LLC that i opened for this home. My question is if i use my personal name as Landlord or the name of my LLC on leasing contract. I want go the way that protects my the most from any future claims/lawsuits from renters. Any suggestions.... thank you in advance
@Gurjeet Brar You should sign the lease in a way that indicates you are acting as an agent or authorized representative for the business, not as an individual. For example;
Paws & Claws Properties, LLC By: __________________________ Jason Jesse, Manager
Signing like this indicates the LLC is the one entering the agreement, and you're simply the person (manager) executing it.
@Gurjeet Brar You should sign the lease in a way that indicates you are acting as an agent or authorized representative for the business, not as an individual. For example;
Paws & Claws Properties, LLC By: __________________________ Jason Jesse, Manager
Signing like this indicates the LLC is the one entering the agreement, and you're simply the person (manager) executing it.
First, as Jaron points out, you will want to make sure that you sign in your representative capacity in the entity that owns the property, assuming that the property is owned by the LLC. This may seem like an obvious qualification, however it's one worth making because too often I see investors, who are making the right move by setting up LLCs for their investments properties, trip at the finish line by not actually transferring or holding the property in the LLC. The LLC cannot provide protection to a property that it does not own.
Second, the distinction Jaron makes—signing in your role under the LLC (e.g. manager, president, etc.)—is especially important because if the property is owned by the LLC but your signing in your individual capacity, you're giving a potential creditor an easy-in to ignore the LLCs protections by piercing your corporate veil. The corporate veil is what separates you from your LLC for liability purposes but when you do not honor this separation—such as when you personally sign for your LLC rather than signing in your role under the LLC—the court and your creditors have good reason not to honor this separation either. This is what is referred to as piercing the corporate veil.
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Good morning everyone. This is my second single family home. I am in process of signing lease. I do have LLC that i opened for this home. My question is if i use my personal name as Landlord or the name of my LLC on leasing contract. I want go the way that protects my the most from any future claims/lawsuits from renters. Any suggestions.... thank you in advance
For maximum protection, use your LLC as the landlord on the lease. This keeps liability with the entity and separates your personal assets from tenant claims.
Make sure your LLC has proper insurance—landlord liability coverage—and that your operating agreement and lease are solid. Doing it in your personal name exposes you personally, even if you have an LLC.