LLC Buying Preperty
how does an LLC buy real estate. what do leanders look for, how does the process go. Is an LLC the best entity for protecting assets? are there any books or websites that can explain more in detail.[ Edited by wes1219 on Date 06/05/2004 ]
I'm in escrow on an LLC deal right now.
Rather than me signing the offer, I as the manager of the LLC did.
I need to provide some info and a "resolution" to the title company.
As there weren't suffient assets in the LLC to qualify for the mortgage, they looked at my personal income/credit.
Deed is in name of LLC as are the 1st & 2nd.
The 2nd did comment that since it's a 1 person LLC that made it easier for them.
CJ
Have you tried to get a loan for operating capital for yout LLC?
I am thinking about doing this same thing. Any input would be great. Thanks
My understanding (from a local CPA) was that LLCs, especially single member ones (like me) are going to find that lenders want your personal guarantee on any loans, especially if there are no assets in the LLC to secure the loan. So while it is possible to take title to the property in the name of the LLC, the financing may be guaranteed by you, the single member, personally.
(Not financial advice, seek professional financial counsel, etc., etc.)
andy
as for short term cash / operating needs I'm looking at several sources:
credit cards w/ cheap interest
bank Business LOC
some federal loans (SBA)
County & state money (one project I'm working is an affordable housing tract)
friends & family. "Hey mom, want to make more than 1.5% on your CD?"
Passive investors. Playing w/ OPM (other people's money)
Would you lend money to a stranger who had no assets, no income, no track record and was only 1 or 2 years old?
Hence lenders are not that interested in lending to an LLC that fits all of the above. If you get a loan with an LLC on title you are very likely being viewed by the lender as the real entity that will be chased for payment if there is an issue.
There is not that much magic around an LLC when it is completely new and has so little history or assets.
Think about it. That is why you have some liability protection. The LLC has little of value so if it is sued it will have little to lose.
A doubled edged sword that cuts both ways.
John
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There is a book entitled, "Wealth Protection Secrets of a Millionaire Real Estate Investor", written by William Bronchick that talks about your concern. I've just started reading and since i'm a novice investor any information helps me at this point.
Good Luck,
Ed
There is a book entitled, "Wealth Protection Secrets of a Millionaire Real Estate Investor", written by William Bronchick that talks about your concern. I've just started reading and since i'm a novice investor any information helps me at this point.
Good Luck,
Ed
The LLC credit thing will change in time. I have unsecured credit lines through one llc I own for 20-30K and they could be easily expanded if I need to.
IT is all about building credit and history over time.
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