LLC Real-estate Purchase Question
We are looking to form an LLC to purchase long term rental properties, fixer-upers, etc.
Can anyone tell me how credit issues are handled when purchasing.? Does the LLC use a tax-id #, or SS#'s of members when looking to secure a loan. Do new LLCs need to take steps to establish credit formally before attempting to secure loans. Thanks. :-?
First of all I'm not an attorney or CPA; however, I have been buying alot of rental properties in the last several months. A single family home up to a 4 plex is a residential loan. 5 plex and above is a commercial loan. Lenders want individual people with social security numbers on the loans. After the closings you can "quick claim" (I think is the term), the property into an LLC so the LLC holds the deed I believe but the individual/s are still on the mortgage. The advantage of the LLC is mainly for liability purposes.
Good Luck,
Betsy
The term is Quit Claim.
HI, I have an 11 unit which was purchased under an LLC. The mortgage is personally guaranteed by myself and partner. However, the tax, deed filings are all listed as the LLC as owner.
I have a sfh which was bought in my name. There aren't many, if any, banks who will provide financing for a residential unit under an LLC Umbrella. We have it as a flip so i'm not too concerened for legal liability. However, if a long term hold, i'd Quit Claim it right after or during the closing.
Jay