QOTW: Do you buy your properties in an LLC?

[Alicia Marks]

Welcome to our question of the week!

We know there are lots of reasons to structure your business. With different goals and objectives it can be hard to decide what might be best. If you haven't seen our new polling feature on the main forum page, please make sure to vote on this week's corresponding question.

Do you keep your properties in an LLC? Do you use a series, trust or other larger holding option? What made you select this approach?

Do you hold in your own name? What do you feel are the advantages to your strategy?

For those that created an entity of some kind, let us know the upkeep requirements. Many people starting on their investment journey struggle with these decisions. Let's discuss how to balance the options!

[Nathan Gesner]

Quote from @Alicia Marks:

The value of an LLC is often exaggerated. Beginning investors spend too much time, energy, and money setting up an LLC when they have bigger fish to fry.

The protections provided by an LLC are beneficial, but knowing and obeying the law will offer you far more protection than an LLC. Proper application screening will protect you more than an LLC. Having solid policies and procedures in place for unpaid rent, lease violations, or security deposit disposition will protect you more than an LLC.

Here's the reality: can anyone name one single investor that was successfully sued for a large enough amount that they lost the investment property? I've been on this forum since 2010 and haven't found a single case, except for a few slumlords that were blatantly violating the law over and over again.

My properties are in an LLC primarily because I want anonymity in my small town. My real protection comes from obeying the law while treating people honestly and fairly.