Where to hire a lawyer?

Question

Hi BP,

I ran into a situation like: I have several properties in Orlando and I'm currently living in LA, California. My PM suggests me to put all my properties in either LLC or Land trust for better asset protection and I'm looking at a lawyer to help me do the transfer. In this case, do you suggest I use a RE lawyer in LA or in Orlando? What is the benefit of that?

Johnny

Jenifer Levini · Answer

Hi @Johnny Yeung,I'm a RE lawyer in California. Honestly, if I was you I'd hire a lawyer in Florida, if that's where all your properties are located. Forming entities in CA is really expensive. The state charges $800/year/entity. If Florida allows Series LLCs then you can do it for much less state fees. Just make sure you dont do any of your business in CA, otherwise you would have to pay state taxes and for entities here too. Good luck,Jen the lawyer

Account Closed · Answer

Orlando would 100% be the way to go - Real Estate is one area of law where you need local knowledge & representation - an out-of-state licensed attorney cannot provide you with counsel on the laws of another state beyond a certain extent (under ethics rules). Further, even if they do so, they won't have local knowledge of what legal forms & contract terms are standard in that specific market -- this is important so that you know you are always getting the best deals via your contracts. Finally, having a local attorney will help you out with reputable referrals for other contacts in the future (a reputable attorney will deal with a varied clientele, so you can reach out to them for escrow agents, real estate brokers, contractors, etc...).If you want to find a good attorney and don't have any leads, I would suggest you reach out to the Bar Association of the city you are dealing with, and ask for a few referrals.

Account Closed · Answer

For the best protection is not to put them all in a single LLC because if you do get sued then they can take all the properties at once. It is best to put each property into a seperate trust, not a LLC. If it is done right then nobody can find you as the owner. The only person that knows who the real owner is the Trustee. It is easy to find the owners of a LLC. Just go to the state where the property is located and look up the owners in the states website. Also if you are sued and you lose then you only lose that one property, not all of them, if you have them in a seperate trust. You need a local Trust Lawyer in Florida.

Steven Hickox · Answer

I am not talking about hiding out here I am talking about taxation. The best way to hold tile to real estate is in a "disregarded entity." That is: disregarded for tax purposes. A revocable trust or a single member LLC are both disregarded entities. (for tax filing purposes) In either case the tax incidents of ownership are then reported on your individual tax return with NO need for the filing of a separate tax return for the entity on title. This minimizes cost without losing the protection of holding title other than in your individual name. Also it allows you to 1031x out of the property and into another property held in you own name or in the name of another disregarded entity. I know this is a bit complicated.

Johnny Yeung · Answer

@stephen Anderson: In this case, I think I can use my LLC as a beneficiary for all of my separate trusts, right?

Johnny Yeung · Answer

Thanks BPers for the advises! This forum is fantastic!

Chris Reel · Answer

A local real estate attorney well-versed in business law and deal structuring would be your best bet. Ensuring that they have that business law knowledge and experience is key for your situation. Also, be picky. There are tons of lawyers, namely business and real estate lawyers in Florida. Get a good one to work with that you can rely on for your future investments without worry. Trust me, it will pay off in the long run with ROI (believe it or not) and sanity! Good luck.

Sam Ally · Answer

"Boots on the Ground" my man. Anyone you add to your team should have solid knowledge of the area you are conducting business in. If they do not they cannot serve you nor protect you properly, the benefits should be obvious. And yes you should absolutely never keep investment properties in your personal name, in fact your personal residence should not be in your name either if you own it free and clear. The protection and preservation of wealth should be your foremost concern.

Jon S · Answer

Being that the properties are in Orlando i would try to find a real estate atty in orlando area that is familiar with entity law and real estate law