Good Morning All,
My friend has been buying foreclosures for the last few years. Has has turned a handful of them into rent houses, and he has flipped a few more for profit. We have decided to partner up so we can combine our money to purchase more and more expensive foreclosures. Everything will be done on a 50/50 basis. I have a few questions regarding this. We have already purchased two properties, and we have put both on them in our personal names. I am certain this is a mistake, and want to correct this for the next property.
He already has a series LLC set up in Texas that he holds his rentals in and has been purchasing his flips with. My question is, do we need to form a new LLC/series LLC together solely for the purposes of the house flips, or should I form my own series LLC, and then we purchase foreclosures and deed them to both of our LLCs? How exactly would this process work? I am confused as to how this will be handled as far as taxes, bank accounts, funding the rehab costs go, etc. To me, it seems like it would be cleaner and easier for us to both form an LLC together and have one bank account, but if its possible or maybe even better that we both have our own LLC set up, I am not opposed. Also, would it be possible to transfer the two properties we currently own to the LLC once it's formed if they have not sold yet?
Also, is a series LLC or a traditional LLC better for flipping houses? At any one time we will have 1-3 properties in our name. This is all new and slightly overwhelming to me since I have 0 experience. I appreciate any help you can provide. I have been reading the forums for anything I can find on these topics, but I am still conflicted on how to handle it.
