LLC for rental properties

[Brian Dickerson]

Hey all, In contract for our first rental properties. We live in FL and the properties are in NY. For protection I want to make an LLC. Should I make it in FL, or the state the property is located? Does it matter? Also, I haven't found a lender that will close a conventional mortgage to an LLC. So I can just transfer the properties to the LLC after closing I suppose. Is this the standard practice?

[Edward B.]

@Brian Dickerson

If you form it in FL you will have to register in NY to do business there so it is usually best to just form it in NY. You will not find a lender that will close a conventional mortgage in an LLC, they don't exist. You can transfer it, but there are dangers associated with that, which you need to understand before you do it. ie. Due on Sale, Insurance, Title Insurance, etc. Do some research on BP, there are literally thousands of posts with this information.