OfflineHappy new year to all my dg member's I have question and hope someone could give me a detailed answer. I was wondering if you start a llc are you allowed to purchase your first income property under the first time home buyers program they have going, the reason I ask is that I know that when you start a llc you have to wait until the llc has built up credit are is it just better to buy the property without the llc and just add it later to the llc after purchase please help..... thanks in advance.
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It sounds as if you are trying to have your cake and eat it too. The first home buyers programs are designed for owner occupied properties not income properties. There is no reason to put an owner occupied property in a LLC. Frankly, I do not see why you need to place an income property in a LLC.
It makes getting a loan much more difficult. Investors believe that the owners are personally shielded from lawsuits. Problem is that attorneys see through individual ownership and can quickly tear down the LLC and expose the true owner.
Just get a large umbrella insurance policy and you will get better protection for less money and hassle.
It's not only an issue of protection, there could be favorable tax aspects also
Thanks for sharing the difference Simon been around attorneys about this and never knew about the insurance protection, delighted to hear about it, thanks everyone for your comments, Jim
jbischoff
You always have sound advice! Thanks for sharing!
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Believe me when I tell you that an LLC set up and OPERATED properly does provide asset protection AND tax benefits. Of course you would want insurance on your rental properties and during the rehab/selling stages on your fix/flips.
Michael
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Everything Cambells mentioned above sounds about correct but unless you were purchasing your first property in cash thenI can see how you can add it to an LLC.
Reynold Orozco
Another matter to consider is the fact that if you are using this as your personal residence, I would not recommend placing the property in a LLC. One main reason is that I do not believe you would be eligible for your homestead property tax exemption. Investment properties are taxed at a much higher rate than homestead properties. This can amount to hundreds, if not thousands of dollars saved annually.