How to present yourself to renters.

[Zachary Sales]

I am buying a house and am converting my condo into a rental. I don't want to move my condo (and mortgage) into an LLC because I will only have the one investment property at this point and don't want to run into complications with my financing. My plan is to set up a separate email account and office phone number to interface with tenants, but am not sure of how to present this. I would also prefer for the tenant to write a check to XX company instead of me personally. Do people set up an LLC that manages their properties and are separate entities from the property LLCs? Is there a licensing requirement (I don't think there is if you manage only your own properties) and would you recommend doing this vs handle everything as an individual?

[Corby Goade]

If you don't plan to grow your portfolio, then I would agree that you really just need to present yourself professionally and get a solid lease, find a great tenant and treat them with respect- if you do that you'll be fine. We have an LLC that is a management company and has an operating agreement with our LLC that holds our assets. We present ourselves as owners of the management company, not the property. I see there are several people above who say this looks shady and that tenants will always find out- well, that's never happened to us, I suspect because we screen thoroughly and treat our tenants really well and with respect. There's no reason for them to dig in to our personal situation.

Also, if you DID want to move the property into an LLC, it wouldn't complicate or change your financing situation at all, with the exception of the possibility of your loan being called.

In Idaho, it's $100 to set up an LLC and there are no annual fees. Some states are much more expensive and have complicated reporting requirements, but here, it's a no brainer to set up an LLC so we can open a business bank account, use that for a PO box, etc.

Honestly, the easiest thing you can do to protect yourself is screen your tenants properly, treat them with respect and appreciation and respond promptly to any inquiry. If you do those things you will be just fine. Not to say you shouldn't have insurance, an attorney or a great accountant, but you can avoid 95% of your potential issues if you do the above. Good luck!