setup LLC?

[Jeremy H.]

Hi, I was talking to a lawyer about drafting up a lease / rental agreement for me.

He quickly suggested it is a good idea to setup a LLC, he said it is going to be $2500.

He said then the tenant can't find out who I am.   Also, protection from any lawsuit about injury or mold (if it comes to that) won't involve my other properties.   I live in one property and planning to rent out my previous home, the junk mail often have my name on it and I maybe the handyman for minor repairs.

The alternative is a lot of insurance.  For $800 (CA franchise tax) a year I think that can buy maybe a few million coverage umbrella.  (I have a small one right now).

I research about the LLC and some say it's great and some say you don't really need.

Anyway, do you think $2500 is out of line and should I really do LLC? I was thinking this is someone you can apply with the state on your own too so I am not sure what the cost may include. That doesn't include drafting the agreement for around $1000 but he said he will discount it.

Thanks