Best way to borrow-LLC or personal?

[Eric Davenport]

Hello All!

What is the best way to secure a loan under an LLC to reduce liability? I know that many banks do not lend to LLC's and transferring a personal loan to an LLC can trigger the due on sale. It's rare that banks call on this, but at least in the early days of my investing I'd like not to take any chances.

How do you borrow and reduce the liability as much as possible?

Thank you for any insight or suggestions!

-Eric

[Seth Williams]

Tons of banks will lend to LLCs, you may just have to personally guarantee the loan. Also, look for some local banks like credit unions and the sort. Banks will often lend to investors in the area with some experience. The bank does whats call a portfolio loan, meaning they dont sell the loan to the secondary mortgage market so they can break the rules a bit. If they see it to be a good deal ( cap Rate, Debt service coverage ) then they will proceed. Do some digging on it, and talk to your local banks! Good luck.