Hi all! I've been searching the forums and continue to be confused about opening up a business bank account for my first rental. The rental is out of state and will be purchased out of state under my name (probably big mistake). I contacted my lending institution US Bank and asked them if the property (conventional lending) can be purchased in an LLC and the banker said no. I failed to create an LLC in that state prior to signing the contract. I want to open up a business account also with US Bank to separate my personal account from the rental account. After reading dozens of discussion and listening to tons of podcasts about this topic, I am confused as to whether it is still worth it to register an out of state LLC and to have my bank account opened in my state under that LLC? I hope I am missing something here. My intent is to have some level of protection but since the property is under my name does it even make sense to open up a bank account under an LLC that the property is not under or just go with a sole proprietorship? I hope you are not as confused as I am because I am sure I am misjudging something here. Please help and thank you!
@Greg Mihaylov if you have an LLC that is created in one state, you have to register it as a "Foreign" LLC in the state that the property is located in. If you have an LLC you must open business account for the company. That account does not have to be in the state the property is in.
If the contract has your name as the buyer, You need to get your company's name on the contract. (Some contracts are assignable, some are not) in order to buy in the name of your company.
Loans for LLCs are different than personal loans. If you applied for a loan in your name the bank may not offer loans to LLCs.
There are a lot of issues going on here but hopefully this will get you started. Ask for clairfication.