Debating to Create LLC or Rent Out the Property First

[Jona Leu]

Hello BP,

I am new to the real estate investing and would like to create some fortune by rental out my property as side income. Currently I am living in a condo which I've already paid mortgage for around 1 ½ year. I am preparing to move out in next couple months and would like to rent it out, however, in order to invest more rental properties in the future, I am deciding if I want to create a LLC before I start to rent out the property. I am in Michigan, as I know the registration fee for LLC is $50 and $25 each year to keep it good standing (please correct me if I am wrong). And I have some options:

1.Create a LLC, and transfer the property under LLC and then rent out. Issue I would face:

• Should I transfer my mortgage to LLC too? If so, how can I pay the monthly mortgage with LLC since the beginning balance will be zero? Or I can deposit my personal money as emergency fund/capital just in case the condo will be idle for couple months?
• When is the best time to look for an accountant? Can accountant help me to create LLC or I can personally apply online and seek for advice for operating LLC?
• I used to file the tax return by TurboTax, from my understanding that LLC can be able to file with personal tax return, do I really need an accountant?
• Would you suggest me to do the LLC bookkeeping my own? What kind of software you would suggest? I have a bachelor degree in accounting so hope the knowledge can help me save some money. I am not CPA since I changed my career to other field lol.

2.Rent out the property, and then create and transfer the property title under LLC.

• Will it be more complicated than option 1 for the transfer process (paperwork, cost, time, risk…etc.)? Vice versa?

3.No need to create LLC, buy umbrella policy up to 1 million.

• Would 1 million policy sufficient for only one condo?

Any suggestions would be greatly appreciated! I will keep research the real estate investing in BP and hope to learn more knowledge and be able to invest the second property soon! :)