Buying Property Under LLC Vs. Under Your Name

9 Replies

I am new to real estate investing and I have decided to commit myself to real estate investing. I am attempting to make my first investment purchase which will be a condo. I was wondering if it is better to purchase the condo under an LLC. or purchase it under my name? I plan to put down 20%.

Also, would it be possible to have property funded through a private lender and do a cash finance, and then refinance the property? 

Please advise as I will need all the advice and assistance I could possibly receive. Thanks in advance. 

You can finance under commercial loan When you buy property under LLC . When its under personal name you can refinance under conventional loan. 15% down payment is minimum requirement for 1 unit under conventional loan. There are so many HML who can offer you finances. BP has so many good name which you can use for HML.

Depends on your state. Most people will tell you flat out that you should get an LLC. However, if it's expensive to do so in your state, an insurance policy might be a more cost effective option, with the same protection. Lending will also usually be easier if the property is in your name.

Under your name is fine, especially for your first couple. If you have an LLC, it can still be pierced under several circumstances by a decent lawyer. Your home owners insurance policy covers you for just about any possible form of liability with the exception of negligence. Most lenders won’t finance in an LLC either.

Thank you guys for the information you’ve all provided. I appreciate you.

Start making relationships with multiple lenders in your area so they get to know your name, your face and your's not likely that you'll get approved for a loan using a new LLC with no history..... commercial loans may be different though

I am new as well and looking to purchase a rental at the turn of 2018-2019. In pursuit of this I have asked a few mortgage loan originators at regional banks about lending to LLCs for residential rental property. One answer that surprised me is one of the banks (this is anecdotal from a conversation, and of course would be subject to qualifying etc) would lend to the LLC through their MLO rather than through their commercial side - the members of the LLC would guarantee the note and payments would be on a bimonthly schedule through the term of the note. Thought it was interesting!

LLC serves as psychological protection more that anything else. Although many adamantly sell the necessity of a LLC it is rare to find any one that has actually been protected by it above that provided by insurance coverage.

It will complicate financing some what so it really boiles down to how much psychological security you require at this poin in your business.

Thanks to all for the insight and information shared. 

For a commercial loan I believe having an LLC is required by lenders.

I don't recall talking to any that would write the deal under a personal name.

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