Rental Property LLC Decision

[Devin Radford]

Hello Everyone,

I recently bought a duplex and finished up with the small amount of renovations needed. The duplex is under in my name, I'm wondering should I place it under a LLC before renting it out to provide protection? If I did property mgmt group and leased it through the property mgmt group would that give some protection? Just looking for advice, thoughts, strategies, etc.

Thanks,

Devin

[Cameron Tope]

@Devin Radford I'm not an attorney. 

I didn't worry too much about the LLCs starting out. If you do start an LLC then you're probably not going to use it right which means it's worthless anyways. It also doesn't protect creditors from taking your property if you get sued. The LLC only keeps issues at the property from getting to you, again if you use it right.

If you use a lease agent, and do the right things then you'll be fine. It's when you start getting multiple properties and managing others properties then you'll need protection. 

I didn't put properties in an LLC until I had over 10 SFRs. The attorney's (some of which may comment below) will try to scare you into buying series LLCs and complex strategies but you should have hazard and liability insurance, which will cover most issues.

If you just bought the property it probably doesn't have much equity either so it won't be a target for a hungry attorney (they want to target properties with a lot of equity so they can get a hefty check).

Best of luck!