All Forum Posts by: Craig Hopp

It looks like you are expecting to get a 30 year mortgage on this which might be difficult for a commercial property.  You might find you can only get a 20 year mortgage, possibly in the form of a 5 year arm.  If so, your mortgage payments will go up by about $400 a month.

I used Citizens Bank which is a small regional bank in Virginia. Probably not relevant to California. Also, my LLC operates exactly as @Scott L.  describes.  I had to provide a personal guarantee but the property and the mortgage are under the LLC.

I also agree with @Chris Mason regarding the less favorable terms associated with getting financing through the LLC.

If you ask me, there is no point in having an LLC if you still have to put the mortgage in your own name. That defeats the purpose of the LLC which is supposed to separate the companies assets from your own. If the house is in your name then all of your personal assets are at stake rather than just those of the business.

I had to shop around until I found a smaller bank that would extend credit in the name of my LLC. The larger national banks just aren't that interested in working with small real estate investors. I still had to provide a personal financial statement and income taxes to the bank, but all (7) of my properties are owned by my LLC.

Whether you have the loan in your own name or the LLC, banks will typically require more equity in the deal if it is not your primary residence.