There's always a city schill or two trying to trip you into a lawsuit. 

If you fail to follow the rules, you may open your personal assets to a lawsuit.

A frustrated sister of mine who was her self appointed power of attorney is angry with me taking care of mom - so using her 32 years of legal secretary experience - to illegally become power of attorney she files a lawsuit to get me evicted claiming $2300 rent due for past 19 months = $43000 - it was overturned for many reasons.

I did not do this with two partnerships and one ended in a lawsuit and the other cost me tens of thousands of dollars.

Many states have homestead style laws that make it difficult to take someone's home during a lawsuit or similar event.However, cash out refinances are typically at a higher interest rate than a normal mortgage.  

Of course they weren't out and actually told me that July rent was paid and if I moved forward with removing them from the unit they would file a law suit against me for an unlawful eviction. 

It helps break down ownership of the asset legally and protects your personal assets and your real estate asset from lawsuits.  

No lawsuits from the city. 

Our compromise was to design the upstairs to be like a private in-law suite so it could be rentable on Airbnb when we choose to do so.

The owners are not personally responsible for the debts or lawsuits of the company.