BRRRR refi with LLC?

[Joseph Belgrad]

I'm currently buying a property (3 family) with 210,000 cash using the BRRRR method, rahab budget 50, ARV over 300. I know I'd be leaving some money in the deal, but this is my first investment property, and if those numbers work out then it'll be a win for me, and I'll at least be able to move on to the next property after refinancing.

My question is: Should I put this property in an LLC upon purchase?

I'm not worried about the liability issues right now because I don't really have any other assets, and I plan on using umbrella insurance. However, I do plan on buying 2-4 properties a year and will eventually want to use LLC(s) for liability protection.

My main concern is logistics of the cash out refinance. Without refinancing I'm stuck at one, maybe two, properties in my BRRRR process. My understanding is that getting a conventional mortgage with an LLC is highly unlikely. I suppose commercial is a possibility, but I would really like to take advantage of the 30 year mortgage with lower interest rates. Even if I don't immediately put this property in an LLC, I would want to eventually for the liability purpose. If I did leave it out of LLC, refinanced into a conventional mortgage, then moved it into an LLC, my understanding is that a lender would likely call the loan due at sale.

What are peoples' thought/recommendations?

This is in Worcester, MA