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Updated over 7 years ago on . Most recent reply
LLC Help for new investor
I am a new investor in California and was curious if experienced investors recommend an LLC for their rental properties. What is the approximate cost per LLC and how may rentals do you keep under one LLC? Any other information would be appreciated!
Most Popular Reply
An LLC isn't necessary for a new buy and hold investor and is more of an expense than a benefit.
Most people will recommend just having enough insurance coverage.
An LLC for buy and hold is a pass thru for tax purposes. So, there is no benefit.
An LLC is a corporation and FHA and Fannie Mae will not lend to corporations. So, financing would have to be a commercial loan at higher interest rates and higher down payment expectations.
Most investors will want to at least leave open the options of using lower down payment scenarios with FHA and Fannie Mae and Va loans where applicable.