getting property into a llc

[John Michael Jenkins]

I have just started in real estate and have formed an LLC, how do I
1. get loans in the LLC name
2. or get the property into the LLC after I have got it,
3. and what are the liaibilities of moving property in the LLC

[tedjr]

1) Until the LLC has a good credit rating you will have to get loans in LLC name but be personally liable for the repayment if you get new loans to buy property. If you do sub2's the loans would be in the sellers names. Most banks and mortgage companies will style the name on the loan any way you wish as long as the credit is what they are looking for. I am starting to use hard money lenders again and since the loans are asset based and not based on my credit.
2) When the deed from the seller is prepared  put your LLC name in the blank space where it says buyer. There is no need to get the property in your name first and then deed it to the LLC as your question implies. The LLC or any other entity stands on its own for most of the time totally different from you.
3) The main reason investors use LLC's etc is for protection. I learned the hard way and have filed personal bankruptcy because of bad times where an LLC or something like it would have helped.  I would have still probably had to sign as personally liable but that would not have been as bad. LLC will not protect against fraud. I do not know any liabilities for using LLC except expense to form and extra bookkeeping

Hope my experience and answers helps a bit. Hope some more members will jump in and add some input too.

Thank you,

Ted P. Stokely Jr
11505 Sw Oaks
Austin, Texas  78737

512-301-9171 home
512-587-6177 mobile

[John Michael Jenkins]

Thank you for your help, being new at this most of the conversations
seem to be in the abstract vs how to actually do things. Again thank you.

[Admin]

John,
Getting a loan in the LLC name is not necessarily difficult, whether it's a private loan or more traditional through a small lender.  You'll likely have to prove up your financials unless it's with an individual.  If you go to a generic loan officer for a residential transaction, you can pretty much forget it.

All it takes to transfer ownership of property is a deed.  You can deed a property to Tiger Woods if you so wish.

I'm not going to attempt #3 as that's too much info to cover.  Sorry.

hope it helps...

[StacyKellams]

John,

I agree with Tim and Ted.

I'll just add that sometimes I will contract a property in my name and then assign the contract to my entity before closing. It's very easy to do. All you need is an assignment form.

I've done this when I'm low balling banks. I'll also do it if I know or feel the seller might not want to do business with a real estate company.

[floweng]

Good info so far, but I have two questions:

1) How-to articles and reading suggests that an LLC is a good vehicle, but isn't the income to an LLC subject to self-employment tax (FICA)?  If not, how do you avoid paying the tax?

2) Where do you obtain an assignment form to transfer title?  Can you transfer title after closing with the same form?

Thank you.

[KW3]

I, too, am very interested in knowing how and when a property can be transferred to an LLC.  Appreciate all comments.