Leasing through my LLC

[Manas M.]

Hello fellow investors,

I'll be moving one of my property out of professional management and just try to manage it on my own. The property is currently not leased and I have a trusted realtor who has agreed to help me with marketing and screening process (and I'll be doing the necessary diligence as well).

Now, I want to lease this out via the LLC (that I would setup) even though the property is currently owned by us in a trust. I understand this may not provide the best structure for limiting liability (as would holding the property in LLC would). However, I like the idea of separating out the business aspect of leasing to the LLC.

Are there any potential legal issues that I should be aware of in doing this? Anything that could lead to the lease not being enforceable. As I see it, this is not very much different than signing up with a property management company to manage the lease (but of course in this case, the property management company is also owned by us).

Any other advantages of this structure (other than the separation of business aspect)? Is this something folks do commonly? 

Thanks

[Drew Sygit]

1) Do NOT let the real estate agent do your applicant screening! A PMC has a vested interest in finding good tenants, because they have to deal with them after placing them. What accountability does a real estate agent have for their tenant placements?

2) Most states require a lease to identify the property owner as the "landlord". They also usually allow a PMC to be identified as the "agent" for the landlord. So, your LLC could be the agent for the landlord trust.

Recommend you seek legal advice on this from a competent real estate attorney.