my wife and I currently own two SFH rentals that we placed in an LLC. We are now preparing to move and would like to add our current residence to our rental business.
My question is: how can we operate our present home out of the LLC even though we hold the mortgage under our personal name and not that of the LLC?
Thanks for any tips you can offer.
Be very careful here
I have been down this road, and what has ended up happening here is because you have already owned it, the mortgage will still remain in your personal name. There really is nothing helping you here, other than now connecting both your personal name, and LLC, to that property by transferring it.
Talk to your local investor-friendly, real estate attorney. Ask about the mechanics of a quit-claim deed to transfer the property to your LLC. Also have him/her explain the risks of 1) the due on sale clause in your mortgage and 2) the liability associated if you leave the property in your name. This conversation will take 5-10 minutes and you will have a clear answer at the end.
A clear answer is a good insurance policy.
Thanks for the feed back!
I was wondering if we could leave the property in our name and "hire" our LLC to manage the rental and then pay the LLC most of the cash flow as compensation?
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