Personal Loans With LLCs

[Travis Bagley]

Hello BP,

I currently have a personal loan lined up with a trusted party. I've done a personal loan before and have a promissory note drawn out and agreed upon interest and repayment terms. The intent is that this loan will be used for the purchase of an all cash deal. I have an LLC setup now and obviously want the protection that it offers. What is the correct way to go about getting the money into the LLC? As it stands today I personally am on the hook for the loan, which I am fine with as the LLC has no funds or credit. The only problem is the paper trail seems more complicated as I'd need to get the money into my personal account and then transfer it again to an LLC account.

Do I simply make out a promissory note for the LLC loan as well?

Is a better approach to go back to the trusted party and change the loan to be with the LLC with a personal guarantee? If so do you have any sample paper work on what this looks like?

Looking forward to any advice!

Thank you.