LLC effect on getting lending

[Charles Timmins]

Does a buyer working through an LLC affect how hard it is to get a hard money loan or to refi after the property is bought?

[Kristen L Garner]

Most Hard Money Lenders will either require vesting to be in a LLC or give a small point discount for vesting in an LLC. Non-QM products like DSCR will usually give you the option to close under your personal name or LLC during purchase or refi. The only difficulty added is the requirement of extra paperwork. Typically you will need to provide the following documentation.

-Entity Articles of Organization, Partnership, and Operating Agreements, if any

-Tax Identification Number (Employer Identification Number - EIN)

-Certificate of Good Standing

-Certificate of Authorization for the person executing all documents on behalf of entity

-Borrowing Certificate (LLC Borrowing Certificate - Single Member or LLC Borrowing Certification - Multiple Member

If you decided to switch strategies and refinance with a conforming conventional loan, you would not be able to close in your LLC. Conventional also requires a 12 month seasoning period to do a refinance whereas DSCR is most often 6 months.