Take over or start over?

[Dan V.]

I will be partnering with another investor to buy a mobile home park. We initially talked about forming a new joint venture LLC to acquire the property but he's proposing to buy or take over the company that owns the property instead. His point is that the company was already established (1973) which might help us get favorable financing options as both of us are newbies 1-2 years experience. The company used to own multiple businesses but the park is the only property left and will probably dissolve once sold. I think the company is set as S-corp. For anyone who had done this before, what are the pros and cons of taking over the company versus forming a new one?

We will be talking to our attorney soon but just wanted to get some opinions in here. Any tips on what to look out for when doing the due diligence about the company will be appreciated as well. 

[Michael Plaks]

@Dan V.

I would never do it, despite your partner's valid argument. The reason is potential legal liability from those old businesses that the company used to own.

I'm not an attorney, but I assume I would be inheriting all potential legal problems from unknown old businesses, and that is a hard pass for me.