If you own more than 20% of the entity when the loan is obtained, most lenders will likely require that you PG the note.

.- Unrecaptured falls under section 1250 and is treated as ordinary gains and capped at 25%- My capital gain from appreciation and improvements under section 1231 was treated as a long term capital gain since I owned both assets over a year.Hope this helps.

@Cristal Ochoa @Leiah DotlichI will preface this with the fact that I have a legal background, specifically with estate planning and asset protection.

@Tayvion Payton, my first question is:Why do you believe multifamily offers better value for the time spent managing than other asset classes?

You can still do a 1031 exchange foreign to foreign asset.  

However, since you put the asset into an LLC, I am going assume you care about asset protection and further this discussion just a bit.My advice to you is to seek out local banks where much of their business is derived from commercial lending.

This also allows for property owners to more easily write-off assets that get damaged/destroyed as the value of these assets is determined as part of the study.

Go search the topic "Lifestyle Asset University" here on Bigger Pockets and you will see a longer thread with a lot of opinions (most are not members) but still worth a read as there are a half a dozen paid members from our group who have commented on that thread.We were formerly called Lifestyle Asset University, but I didn't realize that you couldn't use the word University in your company name here in Utah so we changed our name to Vodyssey. 

However, I typically like to make a distinction between my parents assets and my own, simply because doing so provides me more satisfaction when I succeed.

The asset class will be dependant on how much capital you have availabile and how much renovations you plan to perform. 2) Is there an income gap between going after 2 units as opposed to 4?