Buying a rental property as a person or LLC?

[Sasha Tetera]

Hello BP community, 

I hear that buying a rental property as a person yields a better interest rate than buying as an LLC. I also understand the costs associated with the property transfer from a person to LLC, as well as potential tax complications. Is it better to buy as an LLC or buy as a person and then transfer in your experience?

Thank you!

[Basit Siddiqi]

@Sasha Tetera

You live in the great state of California. Residents of California often have to pay the $800 fee for managing an LLC.

LLC's are great as they can provide you asset protection. Something that can be very important if you have a large net worth, have low risk tolerance, have high risk exposure with your real estate investments or have other member's in an LLC.
You should consult with an attorney if an LLC is right for now.

Regarding whether to purchase in the LLC initially or not  - you listed the reasons that people don't initially purchase in the LLC. Investors want that lower interest rate. Getting property transferred from your own name to an LLC can costs thousands of dollars in title work.