So to clarify the how, why and what of hard money loans, I have outlined a very simplified explanation of where we as a hard money (commercial real estate ) lender come in1.

Since you can't escape CA LLC registration, if the property is based here, and if you are a resident here, may make sense just to form a CA LLC and simplify your life and your costs.Most likely the state where the property is located is where lawsuits would be brought if they are something for personal injury like a trip and fall or something of that nature because the “cause of action” arose in that state.

Simplify your finances and get rid of the $100k (or whatever it is) debt at 20-30%.

Alternatively, forming a new LLC in Kentucky can simplify state-specific compliance and might offer better legal protection for the property.

@Kate Lavery For your 1031 exchange combined with the Section 121 exclusion, here's a simplified breakdown of what you need to do:1.

Good luck I appreciate your straightforward advice—it really helps to simplify things!

This will give you a clear picture of any liens or claims that could affect your plan.Consider Subject-To Financing: This gives you more control over the property, simplifies resale (especially if an FHA buyer is involved), and eliminates risks associated with the seller retaining legal title.Weigh the Risks of a Land Contract: If you’re looking to avoid closing costs, a land contract could work, but ensure that the seller is financially stable and cooperative.

Plus, it simplifies the process of adding partners for future projects and helps keep your finances organized.As for BRRR, you can also deduct expenses and LLC income is reported on the owner's personal tax return, avoiding double taxation that corporations face.

If you want to simplify it because you have too many properties to maintain, simply create a main checking account and a security deposit account for each property or Entity.

So, I try to balance the complexity and cost of having to manage too many LLCs (for example with each property having its own LLC) with the need to simplify the tax filing process.