Seeking recommendations for banks to use for multiple bank accounts

Investor · Member since 2022 · 5 posts · 2 votes

Each of my rental properties is held by its own LLC, and each LLC is owned by a holding company that sits at the top (which is owned by me). Each LLC needs its own bank account, but as I scale, I am looking for a better bank that allows me to more efficiently manage multiple bank accounts. I currently use Bluevine, but I have separate logins for each account, which is cumbersome. I would like to have one login where I can access multiple accounts from the same dashboard, or something similar. Curious how other investors with multiple bank accounts handle this and any recommendations for banking institutions you may have. Thanks!

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Chris SeveneyBusiness Member

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Investor · VA · Member since 2015 · 21k+ posts · 19k+ votes

From my research the largest single tenant lawsuit case was in California for $3.8M. The cases which had significant dollars were all blatant discrimination cases or negligence.

If you hire a good property manager, do your property inspections and have a good insurance policy your odds are very slim. I worked for a multibillion dollar family office with over 2,000 units and office / retail etc.

Lawsuits for slipping on the sidewalk when icey are common - owners never paid a penny it was always done through insurance.

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Randall AlanPro Member
Investor · Lakeland, FL · Member since 2017 · 1k+ posts · 1k+ votes
3y
Quote from @Sean Linnehan:

Each of my rental properties is held by its own LLC, and each LLC is owned by a holding company that sits at the top (which is owned by me). Each LLC needs its own bank account, but as I scale, I am looking for a better bank that allows me to more efficiently manage multiple bank accounts. I currently use Bluevine, but I have separate logins for each account, which is cumbersome. I would like to have one login where I can access multiple accounts from the same dashboard, or something similar. Curious how other investors with multiple bank accounts handle this and any recommendations for banking institutions you may have. Thanks!

@Sean Linnehan

I know that bigger banks have what mine calls a linking agreement that allows us to link separate companies and personal accounts into one login. It’s a bit of a hassle to set up (signatures of every owner of every account), but I have my personal accounts, my kids accounts (so multiple different signers / owners), and business accounts with 3 different EIN’s viewable on one login screen - plus I get to add nicknames to each one so I can easily identify them… so I’m not just staring at random account numbers. Makes it so nice to be able to transfer between accounts! I would ask your local banks, or maybe your current bank and try using that terminology… “linking agreement” - my bet is that if one has it, most of them do.

randy

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Nathan GesnerBusiness Member
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Real Estate Broker · Cody, WY · Member since 2010 · 28k+ posts · 41k+ votes
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Quote from @Sean Linnehan:

You are following unnecessary advice and making life more complicated than it needs to be.
Combine the properties. Most attorneys recommend around $1 million in equity per LLC, but you can do as much as you want. Then buy an umbrella insurance policy that covers all your properties and all your equity. Much easier to manage.

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Sean Linnehan
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Investor · Member since 2022 · 5 posts · 2 votes
3y
Quote from @Nathan Gesner:

Quote from @Sean Linnehan:

You are following unnecessary advice and making life more complicated than it needs to be.
Combine the properties. Most attorneys recommend around $1 million in equity per LLC, but you can do as much as you want. Then buy an umbrella insurance policy that covers all your properties and all your equity. Much easier to manage.

Thanks for the post Nathan. I follow your point, but I want to drill down a bit. Wouldn't that approach would be more risky in the event of a large judgment? I would think this would be a risk-appetite question that is particular to each investor. Some investors may not opt for the operational efficiency at the expense of increased risk.
Here is an example to illustrate what I mean (using round numbers for clarity, but would work with any figures depending on the investor's materiality threshold): Let's say I have 4 properties each worth $500K and I have 25% equity in each (total of $2M in property and $500K in equity). Let's say I combine them into one LLC and take out a $2M umbrella policy. For any judgment covered under the umbrella policy (or other insurance) that is less than $2.5M, I would be fine because I could pay the judgment entirely with the policy and the proceeds from the sale of 1 property. However, for a judgment greater than $2.5M (say, $5M -- not unrealistic for a serious injury or death), I would lose everything in that scenario because the judgment creditor could come after all of the assets in the LLC after the umbrella policy caps out. If I had kept each property in a separate LLC, the creditor could only come after the umbrella policy and the one property involved. I would lose $500K in equity in the combined LLC scenario but only $125K in equity with separate LLCs.
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Chris SeveneyBusiness Member
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Investor · VA · Member since 2015 · 21k+ posts · 19k+ votes
3y
Quote from @Sean Linnehan:

Each of my rental properties is held by its own LLC, and each LLC is owned by a holding company that sits at the top (which is owned by me). Each LLC needs its own bank account, but as I scale, I am looking for a better bank that allows me to more efficiently manage multiple bank accounts. I currently use Bluevine, but I have separate logins for each account, which is cumbersome. I would like to have one login where I can access multiple accounts from the same dashboard, or something similar. Curious how other investors with multiple bank accounts handle this and any recommendations for banking institutions you may have. Thanks!

As you scale your CPA is going to want to kill you. You have two entities for every property. You are tossing tons of $ away every year.
One entity for every $5M net worth (not asset value) unless its a commercial deal then we may break that out, but that is for residential SFR/1-4 units.
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Greg Kasmer
Rental Property Investor · Philadelphia, PA · Member since 2021 · 774 posts · 501 votes
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Sean - I'll defer on the LLC and legal protection question and go back to the bank account question. My credit union has a "master account" (one I first created) and then for each additional property creates a "sub account" with a slightly different account number that exists under the master account. I'm able to access all accounts with one login and keep the financials separate. Recently, I've started using a property management company and the financials are kept separate (generating income statement per property) so the need to have separate bank accounts is less needed now than before. Let me know if you have questions. Good Luck!
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Account Closed
Member since 2021 · 40 posts · 27 votes
3y
Quote from @Sean Linnehan:

Each of my rental properties is held by its own LLC, and each LLC is owned by a holding company that sits at the top (which is owned by me). Each LLC needs its own bank account, but as I scale, I am looking for a better bank that allows me to more efficiently manage multiple bank accounts. I currently use Bluevine, but I have separate logins for each account, which is cumbersome. I would like to have one login where I can access multiple accounts from the same dashboard, or something similar. Curious how other investors with multiple bank accounts handle this and any recommendations for banking institutions you may have. Thanks!

Sean, we like Wells Fargo as it allows us to manage and view all of our separate company bank accounts from the same profile.
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Sean Linnehan
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Investor · Member since 2022 · 5 posts · 2 votes
3y
Quote from @Chris Seveney:

Quote from @Sean Linnehan:

Each of my rental properties is held by its own LLC, and each LLC is owned by a holding company that sits at the top (which is owned by me). Each LLC needs its own bank account, but as I scale, I am looking for a better bank that allows me to more efficiently manage multiple bank accounts. I currently use Bluevine, but I have separate logins for each account, which is cumbersome. I would like to have one login where I can access multiple accounts from the same dashboard, or something similar. Curious how other investors with multiple bank accounts handle this and any recommendations for banking institutions you may have. Thanks!

As you scale your CPA is going to want to kill you. You have two entities for every property. You are tossing tons of $ away every year.
One entity for every $5M net worth (not asset value) unless its a commercial deal then we may break that out, but that is for residential SFR/1-4 units.

Not quite -- I have one entity for each property or state (depending on risk tolerance), but only one holding company at the top that holds them all. All of the operating LLCs that hold the property(ies) are wholly-owned by the holding company and are disregarded entities for tax purposes. This means they all get rolled up to the one holding company LLC for tax purposes, which means just one 1065 and K-1. This means there is not really much of a difference for tax purposes. I end up paying a bit more in LLC registration fees by having more than one (talking a few hundred dollars), which in my opinion is well worth the risk mitigation for a large loss (see my hypothetical to Nathan in a separate response above).
And to your point on waiting to break out until you reach $5M in net worth, I pose the same question to you as I posed to Nathan above.
Thanks.
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Marco Anemone
Bolingbrook Illinois · Member since 2018 · 50 posts · 33 votes
3y
@Sean Linnehan, Chase Bank has great online features and functionality, andball account can be accessed at the same time from one user name and password
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Tim J.
Investor · Vermont and New York · Member since 2023 · 308 posts · 309 votes
3y
I use TD Bank. I opened a 3 personal checking accounts and 2 accounts for separate LLCs.
I have access to them all from my primary personal checking
I am able to view the details from Stessa with just the "master" login. The phone app and online banking allows me to see it all with just one login. I can transfer between accounts, etc.
I also had a separate business account for a service company I started. It was also linked as above, but I sold the business and closed the account.

For now this setup works for me.
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Nathan GesnerBusiness Member
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Real Estate Broker · Cody, WY · Member since 2010 · 28k+ posts · 41k+ votes
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Quote from @Sean Linnehan:

Your hypothetical is correct, hypothetically.

Find me one investor on BiggerPockets that was sued for $2,000,000 and lost. I am 99.9989723% certain you won't find one.
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Chris SeveneyBusiness Member
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Investor · VA · Member since 2015 · 21k+ posts · 19k+ votes
3y
From my research the largest single tenant lawsuit case was in California for $3.8M. The cases which had significant dollars were all blatant discrimination cases or negligence.
If you hire a good property manager, do your property inspections and have a good insurance policy your odds are very slim. I worked for a multibillion dollar family office with over 2,000 units and office / retail etc.
Lawsuits for slipping on the sidewalk when icey are common - owners never paid a penny it was always done through insurance.
7e investments53 Reviews
Website View Page
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Nathan GesnerBusiness Member
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Real Estate Broker · Cody, WY · Member since 2010 · 28k+ posts · 41k+ votes
3y
I've seen some big ones in the news, but they are always for large investor slumlords that have egregiously ignored the law (and warnings) for a long time, or Landlords that are downright evil (sexually assaulting women, physically attacking Tenants, etc.).
The best protection: know and obey the law, treat your tenants honestly and fairly. 400 rentals under management, 13 years, and I've never been sued.

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Chris SeveneyBusiness Member
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Investor · VA · Member since 2015 · 21k+ posts · 19k+ votes
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Exactly. Hire good people if you cannot manage the asset (especially if you do not have the time) and be a good landlord.
Yes there have been some large ones on larger MF deals, but most SFR's with one tenant - I do not see someone losing $5M + in a lawsuit unless they have done something so blatant and obvious.
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Jay ThomasPro Member
Real Estate Agent · Houston, TX · Member since 2021 · 1k+ posts · 715 votes
3y
It can be frustrating to keep up with the regulations when scaling your Real Estate business. For every property, two entities might be necessary and this quickly adds up - especially if you're dealing with commercial Real Estate deals. To make things easier, you could consider setting a standard of one entity for every $5M net worth (not asset value), unless it's a commercial Real Estate deal in which case it might be advantageous to break that out. That way, you can save money and avoid wasting precious resources year after year.
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Sean Linnehan
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Investor · Member since 2022 · 5 posts · 2 votes
3y
Quote from @Nathan Gesner:

Nathan, Chris, Thanks for the color. The judgment size helps round out the picture. One more question for you - I assume you foreign qualify your LLC in each state in which you operate?
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