Advice on financing 4 unit multi-family

[Saran Mandhadapu]

Hello,

I am a new investor and I am looking to purchase a 4 unit multi-family in PA. I have two options to purchase this property, please let me know which option you would choose and why?

1) Purchase the property with conventional mortgage in my OWN name. Title will be in my name.

Interest Rate = 4.5%

Fixed term = 30 years

Amortization = 30 years

2) Purchase the property with Commercial mortgage in the name of an LLC that I own. Title will be on LLC name.

Interest Rate = 5.35%

Fixed term = 10 Years

Amortization = 20 years

Payment term = 20 years

What is the best option. I know if I buy in the name of an LLC I get more liability protection. But if I buy using conventional mortgage in my own name, my monthly payments are about $140 per month less.

Please advice

Thanks,

Saran

[Natalie Kolodij]

I would obviously choose the method that cash flowed $200 a month more and then just have a good insurance policy. 

It seems silly to screw yourself into a worse deal just for the slight added protection of an LLC.