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Updated almost 6 years ago on . Most recent reply

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Michael Doherty
  • Real Estate Agent
  • West Hartford, Ct
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Does Closing in an LLC Affect Personal Credit or DTI?

Michael Doherty
  • Real Estate Agent
  • West Hartford, Ct
Posted

I am refinancing a BRRRR that is nearly complete. I purchased in an existing LLC I had and would like to close in the same one. I always thought that closing in an LLC meant that it wouldn't go against your personal DTI or credit. I am getting mixed answers from various lenders/ seasoned investors. Perhaps it's the underlying loan product that makes the difference. Does anyone have any more clarity on this?

For clarification, I want to close in an LLC but DO Not want it to affect my personal DTI or credit. Thank you.

  • Michael Doherty

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Stephanie P.
#5 Mortgage Brokers & Lenders Contributor
  • Washington, DC Mortgage Lender/Broker
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Stephanie P.
#5 Mortgage Brokers & Lenders Contributor
  • Washington, DC Mortgage Lender/Broker
Replied
Originally posted by @Michael Doherty:

I am refinancing a BRRRR that is nearly complete. I purchased in an existing LLC I had and would like to close in the same one. I always thought that closing in an LLC meant that it wouldn't go against your personal DTI or credit. I am getting mixed answers from various lenders/ seasoned investors. Perhaps it's the underlying loan product that makes the difference. Does anyone have any more clarity on this?

For clarification, I want to close in an LLC but DO Not want it to affect my personal DTI or credit. Thank you.

I can only speak to the lenders we use.

  • They do require a personal guarantee.
  • They pull credit on you in the beginning and right before close to make sure you didn't file BK or get foreclosed on
  • The loan does not show up on your personal credit report because the loan is to the LLC, not you.
  • The loan does not affect your DTI because it is made to the LLC, not you.
  • Stephanie P.
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