Holdng Title Question

[Jeff Studer]

Hey There-

For you BRRR Investors out there, do you recommend deeding the home over to an LLC after closing so that the liability is limited to the corporation?

Here are my assumptions of the advantages and disadvantages but please feel free to advise:

HOLDING TITLE IN MY PERSONAL NAME

- no fear of lender calling the note due because there is no transfer of ownership

- because there is no corporation, I'm assuming that you can count write off passive losses on tax returns

- you would need to have an umbrella insurance policy in place to cover yourself if the tenant sues?  If so, how much protection do you recommend?

- can't depreciate the asset (because it's not a business asset) which doesn't allow for the annual tax benefit but also allows you to sell the home later on without having to factor in the depreciation?  This is an assumption.  

TRANSFERING TITLE INTO AN LLC

- Slight fear of the lender calling the note due although I've done this twice and have not had any issue 

- limited exposure to personal assets if sued by a tenant 

- can write off annual passive business losses because the home is now part of a corporation

- would have to depreciate the asset which, again, helps with annual tax advantages but really stings when you go to sell after a long period of time.

Thanks in advance for your help

Jeff