Should I form an LLC?

[Josh C.]

I have two rental properties in Texas in my name and was researching about possibly doing an llc for future ones. The draw backs of an llc are looking pretty bad like:

- lawers can pierce through protection

- insurance company lawers will only represent individual not llc

- forced to use commercial loan, which has higher rates

- confusion on how many LLCs to actually create

I like the idea of not getting an LLC and getting an umbrella policy of maybe 2 million. My plan is to purchase around 25 properties. Is this a bad way to go? Has anyone had over 20 properties in their own name?

[David Disraeli]

The difference between having zero personal liability and any is huge, not to mention no liability. An LLC that is properly constructed and managed is NOT subject to being pierced. Anything is possible but plenty of case to law to support that. Of course, there are a number of ways to sabotage your own entity if you aren't careful. A complete discussion of this is way beyond a blog post. You do not need to use a commercial loan if you buy/finance first which is what all my clients do. Lastly in Texas you only need one "series" LLC to maximize protection for multiple properties. PM me if you'd like more information.