All Forum Posts by: William Howley

Thanks @jeffrey that is looking like what im going to have to do. Bigger question is if its even worth moving it back to the llc. Im considering going the sole proprietor direction until my compaby is bigger. 

Hey Nicholas, I have been researching this exact topic for quite some time, and I feel we are in very similar situations. So this could be helpful. 

I have a day job, and bought my first rental property last year under a newly formed LLC. bought the property cash, my plan was to get a cash out refinance 1st mortgage on the property and thus have enough cash to get another one. I was going to attempt to do this over and over until I had a portfolio to pay off the various micro loans.

Unfortunately, I have had nothing but problems having the title in the LLC name. Banks do not want to work with LLC's for various reasons. I am considering moving the title into my own name. It was to my surprise that a lot of invstors are actually not going the LLC route. I thought that everyone got an LLC, like that is just what you do. Instead they get landlord and personal umbrella insurance. When I got the LLC I thought, "oh I need to do this to get protected" but as I am reading more and more it seems that an LLC might not actually protect you. Here is a great article I read recently that explains the massive hypercomplex unpredictability of lawsuits and how having an LLC might not even protect you.

http://www.johntreed.com/blogs/john-t-reed-s-real-estate-investment-blog/65996803-how-should-you-hold-title-to-real-estate-or-your-business

In the end I would suggest staying sole proprietor. 

Hi, I have a rental property in my LLC name, and it has been a nightmare, if not impossible trying to get funding or a mortgage against the property. Banks just dont want to deal with those entities. Someone suggested either adding my name to the title or quit claiming the title to my name only. What do you guys think?

In both cases I would get a landlord policy and a PUP to protect myself. 

surprisingly Mindy, no they are not. there are many restrictions on businesses that do not exist when under your personal name. For example one restriction is the business must be 2 years old, which it is not. The business must have a certain amount of income like 50k annul. Bank of america does not do commercial loans to company's under 1,000,000 annual revenue lol. Essentially, they will only loan a business money based on their income, and since I only have 1 rental, they wont do it. It has honestly caused me a huge amount of headache putting this thing under an LLC name, and I have hit nothnig but road blocks. I am actually siding with what other people have to say of doing it under your own name with some personal liability insurance. It would have made everything I wanted to do, possible.

So with this said, with my current situation, If I add my name to the title of the rental, thus there would be LLC name + my name on it, would that hold my personally liable to any lawsuits etc?

$350 a year that is not bad. When you say "must have your liability maxed out on your rental", does that mean I need to get insurance on every single rental property as well? if so what type of insurance is that, renters insurance? What would be a normal price for renters insruance (if that is what I need) on a 50k property, like $40/month?

so than a lot of people dont even bother with the LLC's and put all of the stuff in their own name?

So your saying you never even bothered with the LLC route, and just got a large personal umbrella policy? I'm not sure how much a PUP policy is, but for someone starting off would that be expensive?

Hi, I created a business and bought my first rental under the business name. I have 100% equity in the property and wanted to cash out refi the property in order to get cash our to buy another. No bank will do this because the property is in my business name so a bank had suggested putting my name on the title. 

If this is true, and the only solution, than what was the purpose of me getting a business in the first place? 

Hi, in 2015 I bought a rental property for 50k cash under a business LLC name I had created. My strategy originally was going to be, purchase the property 100% equity, than get a first mortgage on that property to cash out and thus have enough capitol to buy another property.

This is were the problem occurs. Because the business is new, and only has income from that one rental property, banks are not willing to do a commercial loan. They are also not able to do a personal loan on the property because the title is in my business name and all of my income is from my day job. One bank had suggested also adding my name onto the title of the property so the title would have both the business name and my name. It would also have to season on the title for 6 months. 

Question is, do I assume more risk on the property by adding my name to the title, if I were to get sued for example? If this is the case and I must add my name to the title than my creating this LLC was pretty much a waste.

Any advice would be helpful I'm kind of stuck right now, and I have not found a way to expand my real estate portfolio. I have been stuck at 1 property for quite some time.