Help please! Setting up the business/LLC and bank accounts

[Jonny Morris]

Dear BP, Firstly, I would like to share that I am doing my best to learn and don't want to give the impression, as sometimes is the case, that I have not tried to find the answers. I have my HELOC approved. I have the following ‘goals’ or ‘things to do’ before I buy my next property. 1) Need a name for the business (Will be BRRRRing properties) 2) File LLC with state. 3) Get EIN. 4) Write my own ‘Operating Agreement’ 5) Open a business bank account. 6) Buy property. My questions are as follows: a) I am getting overwhelmed with the concept of a holding company and multiple LLC’s to protect me etc. Does anyone have a simple model for their R.E business? b) Should I use an attorney? I know this depends on my comfort level on the matter – I feel like this process is possible but don't want to be naïve. c) With funds in my HELOC, can I simply write a check from my HELOC to my business account for purchasing property through the LLC? I feel like I am getting closer and closer to the deal and believe firmly in the quote from Abraham Lincoln: “Give me six hours to chop down a tree and I will spend the first four sharpening the axe.” I appreciate your help and guidance sharpening my axe!

[Joshua Davies]

Jonny Morris there are lenders out there that will allow the transfer of title from personal name to LLC upon closing. They will approve you for the loan in your personal name and then allow the transfer when you close.

I simply asked for lenders approval on this and let them know that I would still personally guarantee the loan and that I was doing this strictly for asset protection and they were fine with that.

Even if you can’t get approval for it through your lender, I have never heard of a lender actually calling the loan due. It is extremely rare, especially as interest rates are still so low. I guess it all depends whether you are willing to take he chance - a lot of investors do.