First time investor. Best LLC structure for multiple properties

[Ather Taqui]

Hi,

I am a new investor and just closed on my first rental property. Its in NC. Its under $250K.

Its currently titled as "Joint Tenants by Entirety" with spouse

I have been researching best way of LLC structures for multiple rental properties (plan to get more in future).

I saw a BP post which recommended a simplistic approach of  one LLC for operations and one Series LLC for asset holding, however it seems NC doesnt allow Series LLC

What are my options and what are pros/cons?

Thanks so much!

[Evan Polaski]

@Ather Taqui, I may be a little too lacadazical on this front, but you are likely overthinking it. I was up to 9 properties all under my one LLC. I self managed under that same LLC.

Not saying this is the right way, but any LLC will create more work for you. If you have an ownership LLC and a management LLC, you will start having a lot of different signature blocks that all need to be kept straight. And then separate bank accounts for each LLC, I believe including each series. You will have separate operating agreements, etc. Financing deals through your LLC will be more expensive.

And, as soon as you mess up one transaction or one signature block, you very well could have just "pierced the corporate veil" and rendered all these LLCs meaningless, depending on how it was pierced.

At the end of the day, this is not a matter for BiggerPockets.  You need to talk with your attorney and tax advisor to determine the best structure for you and your goals.

One big positive in LLCs, even though the cost to finance is much higher (more down and higher interest rates), when you get commercial loans, they will no longer be on your credit report.  You will likely have personal guarantees, but those are contingent liabilities to you and not show when you are applying for personal credit.