LLC business structure and qualifying for a mortgage

4 Replies

I have a LLC that i use to rent properties. In a couple of years i want to use income derived from that to help qualify for a mortgage. How should this be structured so that i can properly use that income? This is a new LLC and i JUST started leasing these homes. Thanx.

Chances are you're not going to get a mortgage with an LLC unless you have substantial revenue for several years and very solid books. But in the case that you do get a business loan, I'm not so sure the structure of the LLC is going play an enormous role in an underwriting decision since most lenders are likely going to put you through a normal underwriting process with your personal finances, with you giving a PG.

Originally posted by @Blair Poelman :

Chances are you're not going to get a mortgage with an LLC unless you have substantial revenue for several years and very solid books. But in the case that you do get a business loan, I'm not so sure the structure of the LLC is going play an enormous role in an underwriting decision since most lenders are likely going to put you through a normal underwriting process with your personal finances, with you giving a PG.

I think you misunderstood me. I don't want the mortgage in the name of the LLC. I wanted to use the income generated by the LLC as personal income to qualify for a personal mortgage. I gave this some more thought and I THINK that since I'm not electing to have the LLC treated as a corporation, the rental income will flow thru to my personal income tax return and I file the appropriate schedules. Its a single member LLC.

@John Smith   yeah, I think I misunderstood.  

Depending on how you do your taxes, money generated through the LLC is likely to be treated as personal income anyways - but you really need to sit down with your CPA to plan out exactly how you need to move forward in order to get the benefits your looking for.