Partnership or wait for LLC?

[Kyle McLain]

Hello,

I am looking to purchase my first real estate investment (a duplex or triplex) with my best friend. In preparing to start investing with my friend, I am trying to understand our best options for both how we should format our company as well as how we should handle our loans. In your opinion, should my friend and I form a partnership and purchase the first few properties through the partnership and then once we have a few properties form an LLC and transfer the properties into the LLC? Or should we not bother with the partnership and just buy the properties and once we have a few properties we then form an LLC? Also, we plan on using conventional loans to fund our investments (at first at least). Do you recommend we have both our names on the loans for each property or should we only have one of our names on the loans for the properties in order to maximize the amount of conventional funding we can receive? If we do just have one of our names, we both still plan to own the property together. In that case, how would we handle sharing equally a property that only has one of our names on the loan? Any advice would be much appreciated. As you can tell I am still very new to the technicalities of real estate business setup and conventional loans.

Thanks,

Kyle