Should I open up an LLC?

[Kevin Deady]

Hello BP community, As I inch closer and closer to making my first deal happen, I’m wondering if I should open up an LLC. My game plan is to buy a Multi family (2-4) in Westchester County, NY, and live in one of the units. Any advice would be greatly appreciated for this noobie. *also if anyone is in the Westchester area, I’d love to meet up and chat. * Thanks!

[Scott Wolf]

@Kevin Deady, @Thomas S. is mostly right. If you purchase in an LLC for a home to live in, you will need a larger down payment, pay a higher interest rate and have other associated (small) annual fees for the LLC.

I'm currently using a bank in Westchester for a three-family purchase in an LLC(\, and they're underwriting it through the residential arm of the bank. I'm getting a very good rate, but did need to provide a 25% down payment, which is better than 30%(typical commercial loan), but nowhere near as good as a 5% down payment you could use as the owner-occupant.