LLC vs. Personal for cash-flowing BRRRR properties
Hello everyone!
I recently found a local portfolio lender that fits perfectly into the types of BRRRR properties I want to acquire. They are cheaper (<$100k), single-story, SFHs built in the 50's/60's. They are cash-flow properties. Since I am trying to transition to a full-time investor, these low-maintenance properties in a few select neighborhoods will help me get there sooner.
I am going through the cash-out refinance process now for my first BRRRR. I bought it as a foreclosure, updated all the plumbing, new bathrooms, new kitchen, new hot water, new furnace/AC - Should be relatively low-maintenance. I will pull out $5,000 more than I put in and cash-flow $150/month ($260 while I am self-managing). The loan is amortized over 30 years with no balloon. I want to do more of these.
The caveat is: this financing option is only available on properties in my personal name. I wanted to begin putting everything into my LLC, however, if I were to purchase good umbrella insurance for these rentals, will that be enough? I know some say that putting property in your names is the "old school way" and I don't want to shoot myself in the foot longterm. The opportunity is there for me over the next 2 years to add 10+ of these properties as fast as I can find them, rehab them and get them rented up. (Oh yes, I forgot to mention that when significant renovations are completed that I won't need to wait out the 6-month seasoning since they're a portfolio lender; they don't have the 5-mortgage limit either).