Unique ownership situation...

[Scott J.]

I am getting conflicting advice (from RE attorneys) on how to structure the ownership of this deal. I would greatly appreciate any advice you pros can offer (I understand it's not legal advice.)

Here's the situation: my wife and I are putting 50% down and my parents are putting 50% down on a $500k property. We have two goals 1) asset protection from lawsuits, and 2) ensuring ownership transfers from my parents to us assuming they die first (their other assets will be split equally among their kids).

Here are the two suggestions we have heard:

1) Own as joint tenants so ownership automatically reverts to my wife and I. Purchase liability insurance.

2) My wife and I purchase, transfer to an LLC where all of us are owners (for asset protection). They would put in their will that the LLC transfers to my wife and I upon their death.

I am strongly leaning towards #1 due to simplicity, also it doesn't rely on someone else's will. What do you think? Also, how does the cost of an LLC compare to liability insurance (for one property)?