Should I buy the property in my name or under LLC if its a BRRRR

[Haishan Peiris]

I am looking to purchase a property to BRRRR (Buy, Rehab, Rent, Refinance, Repeat). Should I purchase it in my name or in the LLC name?

[Sheldon Zimmerman]

This is a great question. I do feel this is a long conversation in order to truly decide. However, It depends on your end game and how you want to handle your business. This is personally how I feel and think you can't go wrong either way. But should know the results of each situation.

LLC - This is a great way to separate your name and your assets for Liability purposes. So depending on if you are buying a SFH or a Multi. If the property is 5 units or more, you have to go commercial loan so if that is the case LLC is the way you should go. When it comes to the back end it depends on what the local commercial lender will offer you. Around here in PA, lenders are doing 80% LTV, with 20-year amm, and 5-year rate lock. This can vary by bank but those are common in this area. LTV is great, however, if you are wanting a longer rate lock you will either pay for it or you will want to go in your personal name.

Personal name - Fannie Mae will offer on a cash-out refinance 70% LTV on 2-4 units. They will offer slightly higher LTV I think it might be 75% with a SFH. This is a 30-year rate lock and is a good long term hold product. I do recommend you get an umbrella policy if you put the property in your name for liability protection. However, talk to your local legal team for the best advice.

This can vary per location, so I'm not sure where you are at and the terms in which the bank is offering. But in south-central PA this is what we have found. Again I highly recommend talking to a legal professional to determine the best asset protection for you and your situation but on the financing side personal name can be great for long-term success. But you can't go wrong if you set yourself upright with a good professional team. Best of luck