I was recently pre-qualified with a friend, we're looking to put an offer down on our first property. Just wanted to see if there are any lessons or recommendations that you all have regarding buying a property with co-borrower? Did you have both your names on the property and then deed it to an LLC? Any and all feedback would be greatly appreciated here. We're looking to buy in the Atlanta area.
Did you have both your names on the property and then deed it to an LLC
Why would you do that. If you want it in a LLC then just buy it in an LLC.
If I was going to own a property with someone else I would absolutely buy in an LLC. That is true whether I was doing a flip or for holding a rental longer term. There are a lot of issues to consider here and I recommend talking with an attorney.
Hey @Ned Carey thanks for the feedback here. We definitely plan to consult with an attorney, but getting pre-qualified together was a stronger option to secure financing (as opposed to doing it through a new LLC).
You are putting yourself at risk if you purchase it in your own names. The LLC is a protective shell for your assets if something goes wrong.
Also, whatever you and your co-founder decide to do, you need to have your agreements DOCUMENTED. I don't care how cool you are with your partner. DOCUMENTATION BEATS CONVERSATION.
Money tends to reveal the true nature of people. Some I thought were cool and solid turned out to be very different when it came to the dollars and deals. Protect YOURSELF first!
Doesn't it get significantly more difficult to obtain financing when an LLC is involved? I have wanted to put my properties in an LLC but have resisted for this reason. I've been told by many that you cannot refinance, sell, or obtain a HELOC on a property in an LLC because no bank will do it.
Hey @Nicole Heasley ,
I have a call with my lawyer sometime next week, I'll be sure to update you as I've always heard the same things. My business partner and I got pre-qualified together and bought the property in our names. We're looking to deed the property inside an LLC prior to tenants moving in. I'll be sure to follow-up here. But thanks again everyone for the feedback!
@Tre Jenkins Do you have a lender as well? A conference call with both your lender and attorney would be wise. That way, when one gives you a piece of advice, the other can tell you if it will or won't work on their end. In a perfect world, they'll be able to collaborate and help you find solutions together.