Purchasing first rental property under LLC with mortgage

[Anthony Portugal]

Hello everyone,

I've been an off/on lurker here for a couple years and an aspiring rental property investor. 

After finishing grad school a few years ago and building some capital, I'm finally in a position to potentially invest in a rental property.

Ideally, I would like to obtain a mortgage to purchase property under an LLC from the get go. But, correct me if I'm wrong, I understand that obtaining a mortgage for a newly formed LLC would be extremely difficult. So, I'm assuming this may not be an option.

I do currently have enough cash to purchase a property outright, placing the title under the LLC. But since this would be 90% of my savings, I do not want keep the cash equity in the house. My question is, would I still run into problems obtaining a mortgage under an LLC for a paid off property owned by the LLC?

Thank you ahead of time for all advice/suggestions. This is a great site!

Anthony 

[Colleen F.]

Regardless of when you buy an investment or a home the total debt counts so your debt to income is pretty much the same regardless of the order you buy things. I would forget the LLC for the moment (doesn't sound like you have lots of assets to protect). In your situation I would buy a house for myself to turn into a rental in a few years, then turn it into a rental and buy another house for myself. The mortgage is owner occupied and cheaper. Just make sure to change the insurance when you move out.