Duluth, GA · Member since 2015 · 17 posts · 3 votes
Hello! Fellow Investors,
Thanks for taking the time to read the questions and answering.
I am a small time investor and do have 2 investment properties. Both giving a small but a + cash flow. I am now looking for a 3rd one.
My question is do I keep buying on individual name ? when does one actually open a LLC.
Are there any actual benefits buying on one v/s the other ?
My second question is can you please advise on how to reduce closing costs ?. Loans of around 100K for my 3rd investment property comes to a little over 4K. Do I just suck it up or there are things which can reduce closing costs which may be I am not doing.
As for when to start using an LLC - that's a personal choice, but generally I'd start with an LLC sooner rather than later, it's easier and cheaper as you don't have to pay transfer tax on as many properties to move them over under your name. That said, you should have sufficient liability insurance.
As for your second question, the only things I can think of are:
have the seller pay closing costs (as seller financing), which isn't really decreasing the cost so much as deferring the cost
Don't use an agent, then convince the sellers agent to split the commission with you instead.
Buy all cash
Use private money with no up front costs - but if you refinance you'll be paying them on the backend
Shop around with different banks. They all have different origination fees.