Is there a particular way to buy your first property in an LLC?

[David Hagen]

Good morning, all! I’m looking at purchasing my first investment property in northern Illinois, but I’m finding myself hung up on how to effectively get this property into an LLC. I was looking at using a traditional lender for a 30-year loan From what I’ve read it requires that I find a lender that is willing to let me sell the property to the LLC whilst keeping the mortgage liability in my name, but I’m not sure how common that actually is. The only other method I’ve seen is to buy ther property outright, which isn’t an option currently Does anyone have a particular method they used to establish this? Thank you in advance!

[Kenneth Garrett]

David, if you buy the property in a LLC you are looking at commercial financing. In a single family home, the terms are typically 5 year balloons amortized over 20 or 25 years. There are a variety of options. Check out small local lenders. Stay away from the large banks. I traditionally use commercial loans for my investment properties.

If the loan is in your personal name then you are looking at a residential loan.  That is where the 30 year mortgage is applicable.  

There are investors who buy in there name and transfer over to an LLC. In theory that is transferring ownership and the loan could be called due although that is unlikely but there is 1% chance it could happen.

The advantage of the LLC is asset protection. Check out Mark Kohler (attorney and cpa) he has many you tube videos on asset protection.

Hope this helps.