Home Buying in 07302>Question Details

Garrett L Mi…, Home Buyer in Jersey City, NJ

In the Jersey City area this fall I plan to purchase 1 or 2 properties and convert them into rental units. Should I form an LLC as a landlord?

Asked by Garrett L Mills, Jersey City, NJ Wed Oct 3, 2012

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I have a 2 family home that is a rental income. We are presently getting $2625 a month in rent.
We are preparing to sell the home and have installed a new gas heating system that is split between 2 floors and we have also installed two new water heaters.
We have a 3 car garage, one is presently rented and we are in the process of preparing the double garage for rent as well. Please contact me if you are interested.
1 vote Thank Flag Link Tue Oct 16, 2012
Helen
it is around the corner form St Peter's college on West Side Ave.
Pat
Flag Mon Oct 22, 2012
Hi Pat, I was wondering which part of jersey city you in? Thanks.
Flag Sun Oct 21, 2012
That is a good idea to do. Most lenders require an LLc be established for 1 year in order to do this.



Call me i can walk you through it , and close you.




Jose Martinez
Coldwell Banker Home Loans Hoboken
201-4941-973
0 votes Thank Flag Link Fri Oct 19, 2012
You can, but most investors use personal credit on their first couple of purchases. After this they, then put the properties under the llc.
0 votes Thank Flag Link Sun Oct 7, 2012
Highly recommend you do. One for each property. Verify with your accountant and attorney. Good luck!
Web Reference: http://www.dianeglander.com
0 votes Thank Flag Link Thu Oct 4, 2012
There are no tax benefits to forming the LLC. As well, it doesn't really protect you against a suit. If the money comes to the LLC and then to you, courts look at that as "Walks like a duck, talks like a duck, quacks like a duck. It's a duck." Any suit will be both against you and the LLC and the judge will likely not remove you from suit. Better to get yourself insured adequately. I work with many investors and am one myself for about 25 years. None of us are LLCs (well, I am for my business as a realtor, but that is a different thing - that's a real job, unlike landlording, which is simply investing). Don't fool yourself thinking that an LLC will save you. That said, if you are building something, LLCs make perfect sense - that's a project, a thing, whole unto itself. Being a landlord on an ongoing basis is not. Depending on your tax situation, you could actually end up losing money having the LLC hold the property. I have an attorney I trust implicitly for these matters, and this is his viewpoint as well.

David Leonard
Weichert Realtors, Jersey City
718-915-2855
dave@davidleonard.biz
0 votes Thank Flag Link Thu Oct 4, 2012
Garrett,
Yes, form an LLC for each property. I have some great attorney contacts, if you need a referral...
Feel free to reach out at your convenience if you wish to work together.
Best regards,

Mark
0 votes Thank Flag Link Wed Oct 3, 2012
Yes, that's typically what you want to do. However bear in mind that, if you're not buying cash and you're applying for a loan, you'd have to purchase them in your personal name and the loan would also be in your personal name. Then you should be able to do a quitclaim deed to transfer ownership to the LLC, but the mortgage remains in your name. You should also consult with mortgage broker, attorney, and accountant, so you can understand the full breath of what this involves. It's not complicated, but mistakes could be costly.

Let me know if you'd like further guidance.

Eric J.
0 votes Thank Flag Link Wed Oct 3, 2012
I did. That way you cannot be sued personally In fact, I have two properties and each is a separate LLC so that if someone from one property sues me, it doesn't jeopardize the other property. . There are some minor drawbacks like if you go to Landlord/Tenant court, you will need to be represented by an attorney. Small price to pay to protect your assets. Feel free to contact me if you need help in assessing solid investment properties or to discuss Landlord laws and obligations. And find a good attorney. BTW, you can use an atty to do the paperwork for the LLC but there are lots of online resources for it quite inexpensively too.
0 votes Thank Flag Link Wed Oct 3, 2012
speak to an attorney but you probably want separate LLC for each property
0 votes Thank Flag Link Wed Oct 3, 2012
Yes garrett, llc is the best iidea. To form a llc, u get the gest tax benifits from it
0 votes Thank Flag Link Wed Oct 3, 2012
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