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LLC - Limited liability company

LLC - Limited liability company

LLC - Limited liability company

Depth discussion on the LLC
Since there are a lot of questions about the LLC issue, I would like to hear from people who have an LLC and they were in a situation where the LLC protected them or had a situation that if they were an LLC they would protect them.
Request: First-hand stories and not “I heard. . . ”Or“ my friend ”- I know a lot of them !!!!
I'm first

Link to the original post in the United States Real Estate Forum on Facebook - Works on a desktop computer (To view the post must be members approved for the forum):
http://bit.ly/2NAWpa7

The original responses to the post can be read at the bottom of the current post page on the site or in the link to a post on Facebook and of course you are invited to join the discussion

 

  • I have lived in the US for over 15 years and have been involved in real estate investments. The LLC question always arises, but always.
    Throughout these years, every opportunity I have, I look for the story (s) to show me how the LLC saved the situation.
    To date, I have only heard one story, and this story also does not really show how much an LLC could have helped.
    It is important to note that in all my years of activity I have lectured over 350 times in different rooms in different places in the US and delivered more than 400 webinars.
    I even brought in attorneys to talk about LLC and always without exception they sowed fear in the audience that they should buy their product / service.
    I also ask my colleagues in the field who have been investing for many years and have a lot of experience - I have not yet found the story.
    To this day I do not really have a story that reflects how much the LLC is the only “truth”.
    I am not for or against but argue that there is a lot of hype for the subject, lots of intimidation and implications that need to be understood if it is very important or just desirable to have an LLC.
    Also, many times investors forget or don't know that the LLC is not 100% protection and there are also situations where the LLC is not sure to protect the owner of the property.
    What’s important is: Let’s not put the LLC on an altar without understanding its full meaning.
  • A story of a couple of my investors about a house that did not buy my way: Once a man crossed their grass and sat down the leg (or hand). He sued them for $ 50K.
    Didn't they have an LLC?
    But did they have insurance?
    What did the insurance do - negotiate with the plaintiff and close on $ 25K
    The story was told to me personally by the property owners about their home from both of them - meaning not a story of someone far away from them.
    The property was in the Greater Denver area.
  • Perhaps another angle to the llc issue but in my opinion it can help more because of the family llc where the parents are the owners who make decisions and the children are holding equal percentages and for the sake of continuity, I read about this interesting article.
  • And one more thing - if you do not have a story say “I do not have one” so we know it's not just my post
    (By the way sorry for the English but I do not have Hebrew installed on my Android)
  • So what's the bottom line? Should you do an LLC or is it unnecessary?
  • I am in the process of taking out a mortgage in the US and was asked to open an llc…
  • I have a number of llc open in my name or I am a member of them. To date, there have not been too many "exceptional" cases in business management and therefore there has never been a need for this entity called llc (other than investor confidence) but !!!
    Another question on the same subject.
    I'm partnering with more 2 members (we hold multiple properties to rent), what else is a possible way to conduct such a business besides llc?
    Joint partnership under one umbrella, joint business bank account, insurance, etc.…

    The same question is true for the Flip deal.

    In the name of whom the transaction will be registered and if investors can participate if there is no company llc ??
    I would love to hear and learn.

  • Apart from the convenience of the LLC in the case of affiliates the body is basically designed to give the owners a limited guarantee. As is the case with insurance in most cases we do not use. But for the one time the problem is that the LLC may protect your private property (outside the LLC). Insurance does provide protection up to the amount of insurance but in case the damage goes beyond the insurance amount then of course your private property may be in danger. The cost of the LLC is relatively low and almost if not in all cases justified in the case of an investment. As non-real estate businesses choose to operate as a limited liability company to protect their shareholders, so is the situation in the case of real estate.
  • Another advantage if buying property under llc with financing, when creditors do not see the mortgage on your name then your income debt ratio stays the same no matter how much mortgage you have, you can take out more mortgages, if it is on your first name there is a restriction on your income to take An excellent amount of a mortgage or a maximum number of mortgages you can write down on your name.
  • Great comments. . . I'm still waiting for the story. . . .
  • As usual Danny..the reactions reinforce your words… The people here have no experiences on the subject… The next step is probably because of the funding for those who want to roll ..
  • I want a post and a dispute about the myth that goes beyond all proportions !?
    And of course "I have no such story".
  • You will respond a bit to the post even if you have no personal experience that will jump him up and help those with the story reach him
  • If a multi-outlet cable is opened, there is the firpta benefit in the sale
  • The protection of a company comes if you have other assets that are not on the same company, keep investors
  • To my delight, no one has a story here, nor will there be.
    A company provides multi-participant investments, the ability to open a bank account by a manager even if you are not physically there
  • 4 has been working for years in the United States, the majority on th
    LLC
    And I have no such story
  • No story?
  • As an asset manager, I ran into threats from tenants "I'll go to the municipality, find out who the owners are and complain!" In the LLC there is indeed an address but there is no name of a person.
  • Worked for many years, I bought a lot of properties, with lots of LLC's for me and investors and have not heard of such a story yet.
    At the same time, a year ago, one of my assets was burned down. Luckily there was no one in the house but if anyone was, I suppose I had a story for you.
    Beyond the many other advantages of the LLC, it is also a form of insurance. In addition to the regular insurance. And insurance is done against catastrophe.
    So we won't have to?
  • Only from clearing Lassie's maintenance did I realize that it is not lucrative for foreign investors and a screen can also be raised.
    The point is this: what kind of assets are you investing in and I will detail: If the assets are modern, in high maintenance, that every pips is repaired (I wish I had to live like this in the country…) without a safety defect, what are the chances of a lawsuit? And even then there is property insurance. Speaking to a major insurance agency they said they had never had such claims. (Liability insurance 300 to 500a).
    I chose not to open to Lesi as the management itself for outsiders is very cumbersome. But that is my opinion and these are the assets I manage.
    Those who have a higher risk, such as weak assets, not of high quality, etc., are better off for protection
  • We, too, have no interesting story for me
  • I have not heard of such a case either. Llc defines roles, division of responsibilities, and division of profits and assets between partners, and gives many significant benefits in taxation (please consult a taxation expert - there are several here in the forum!)
    Sometimes, Israeli (foreign) investors have advantages in getting commercial loans… Regarding the protection, I asked a lawyer in the past who said that in many countries, if there is a claim proving the negligence of the property owners, the judge will usually agree quite easily to lift the LLC "screen"…
    However, if there is “umbrella” insurance with adequate coverage (usually $ 1M- $ 2M), in many cases the judge will limit the compensation to the amount covered by the insurance.

    Again, also talk to a real estate attorney and expert insurance agent…
    (I am not qualified in any of these areas, except mortgages…)

  • I have no story, I did a joint llc with my husband in case of the death of one of us. The goal that when one goes to his second world will sell the assets and evade taxation
  • llc According to Wikipedia it is like Ltd. in Israel. This is a type of corporation that is unique to the United States
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Responses

  1. I have not heard of such a case either. Llc defines roles, division of responsibilities, and division of profits and assets between partners, and gives many significant benefits in taxation (please consult a taxation expert - there are several here in the forum!)
    Sometimes, Israeli (foreign) investors have advantages in getting commercial loans…

    Regarding the defense, I asked a lawyer in the past who said that in many states, if there is a claim that has proved the negligence of the property owners, the judge will usually agree quite easily to lift the "screen" of the LLC
    However, if there is “umbrella” insurance with adequate coverage (usually $ 1M- $ 2M), in many cases the judge will limit the compensation to the amount covered by the insurance.

    Again, also talk to a real estate attorney and expert insurance agent…
    (I am not qualified in any of these areas, except mortgages…)

  2. Only from clearing Lassie's maintenance did I realize that it is not lucrative for foreign investors and a screen can also be raised.
    The point is this: what kind of assets are you investing in and I will detail: If the assets are modern, in high maintenance, that every pips is repaired (I wish I had to live like this in the country…) without a safety defect, what are the chances of a lawsuit? And even then there is property insurance. Speaking to a major insurance agency they said they had never had such claims. (Liability insurance 300 to 500a).
    I chose not to open to Lesi as the management itself for outsiders is very cumbersome. But that is my opinion and these are the assets I manage.
    Those who have a higher risk, such as weak assets, not of high quality, etc., are better off for protection

  3. Worked for many years, I bought a lot of properties, with lots of LLC's for me and investors and have not heard of such a story yet.
    At the same time, a year ago, one of my assets was burned down. Luckily there was no one in the house but if anyone was, I suppose I had a story for you.
    Beyond the many other advantages of the LLC, it is also a form of insurance. In addition to the regular insurance. And insurance is done against catastrophe.
    So we won't have to?

  4. Another advantage if buying property under llc with financing, when creditors do not see the mortgage on your name then your income debt ratio stays the same no matter how much mortgage you have, you can take out more mortgages, if it is on your first name there is a restriction on your income to take An excellent amount of a mortgage or a maximum number of mortgages you can write down on your name.

  5. Apart from the convenience of the LLC in the case of affiliates the body is basically designed to give the owners a limited guarantee. As is the case with insurance in most cases we do not use. But for the one time the problem is that the LLC may protect your private property (outside the LLC). Insurance does provide protection up to the amount of insurance but in case the damage goes beyond the insurance amount then of course your private property may be in danger. The cost of the LLC is relatively low and almost if not in all cases justified in the case of an investment. As non-real estate businesses choose to operate as a limited liability company to protect their shareholders, so is the situation in the case of real estate.

  6. I have a number of llc open in my name or I am a member of them. To date, there have not been too many "exceptional" cases in business management and therefore there has never been a need for this entity called llc (other than investor confidence).

    but !!!
    Another question on the same subject.
    I'm partnering with more 2 members (we hold multiple properties to rent), what else is a possible way to conduct such a business besides llc?
    Joint partnership under one umbrella, joint business bank account, insurance, etc.…

    The same question is true for the Flip deal.

    In the name of whom the transaction will be registered and if investors can participate if there is no company llc ??
    I would love to hear and learn.

  7. A story of a couple of my investors about a house that did not buy my way: Once a man crossed their grass and sat down the leg (or hand). He sued them for $ 50K.
    Didn't they have an LLC?
    But did they have insurance?
    What did the insurance do - negotiate with the plaintiff and close on $ 25K
    The story was told to me personally by the property owners about their home from both of them - meaning not a story of someone far away from them.
    The property was in the Greater Denver area.

  8. I have lived in the US for over 15 years and have been involved in real estate investments. The LLC question always arises, but always.
    Throughout these years, every opportunity I have, I look for the story (s) to show me how the LLC saved the situation.
    To date, I have only heard one story, and this story also does not really show how much an LLC could have helped.
    It is important to note that in all my years of activity I have lectured over 350 times in different rooms in different places in the US and delivered more than 400 webinars.
    I even brought in attorneys to talk about LLC and always without exception they sowed fear in the audience that they should buy their product / service.
    I also ask my colleagues in the field who have been investing for many years and have a lot of experience - I have not yet found the story.
    To this day I do not really have a story that reflects how much the LLC is the only “truth”.
    I am not for or against but argue that there is a lot of hype for the subject, lots of intimidation and implications that need to be understood if it is very important or just desirable to have an LLC.
    Also, many times investors forget or don't know that the LLC is not 100% protection and there are also situations where the LLC is not sure to protect the owner of the property.
    What’s important is: Let’s not put the LLC on an altar without understanding its full meaning.

Responses

  1. I have not heard of such a case either. Llc defines roles, division of responsibilities, and division of profits and assets between partners, and gives many significant benefits in taxation (please consult a taxation expert - there are several here in the forum!)
    Sometimes, Israeli (foreign) investors have advantages in getting commercial loans…

    Regarding the defense, I asked a lawyer in the past who said that in many states, if there is a claim that has proved the negligence of the property owners, the judge will usually agree quite easily to lift the "screen" of the LLC
    However, if there is “umbrella” insurance with adequate coverage (usually $ 1M- $ 2M), in many cases the judge will limit the compensation to the amount covered by the insurance.

    Again, also talk to a real estate attorney and expert insurance agent…
    (I am not qualified in any of these areas, except mortgages…)

  2. Only from clearing Lassie's maintenance did I realize that it is not lucrative for foreign investors and a screen can also be raised.
    The point is this: what kind of assets are you investing in and I will detail: If the assets are modern, in high maintenance, that every pips is repaired (I wish I had to live like this in the country…) without a safety defect, what are the chances of a lawsuit? And even then there is property insurance. Speaking to a major insurance agency they said they had never had such claims. (Liability insurance 300 to 500a).
    I chose not to open to Lesi as the management itself for outsiders is very cumbersome. But that is my opinion and these are the assets I manage.
    Those who have a higher risk, such as weak assets, not of high quality, etc., are better off for protection

  3. Worked for many years, I bought a lot of properties, with lots of LLC's for me and investors and have not heard of such a story yet.
    At the same time, a year ago, one of my assets was burned down. Luckily there was no one in the house but if anyone was, I suppose I had a story for you.
    Beyond the many other advantages of the LLC, it is also a form of insurance. In addition to the regular insurance. And insurance is done against catastrophe.
    So we won't have to?

  4. Another advantage if buying property under llc with financing, when creditors do not see the mortgage on your name then your income debt ratio stays the same no matter how much mortgage you have, you can take out more mortgages, if it is on your first name there is a restriction on your income to take An excellent amount of a mortgage or a maximum number of mortgages you can write down on your name.

  5. Apart from the convenience of the LLC in the case of affiliates the body is basically designed to give the owners a limited guarantee. As is the case with insurance in most cases we do not use. But for the one time the problem is that the LLC may protect your private property (outside the LLC). Insurance does provide protection up to the amount of insurance but in case the damage goes beyond the insurance amount then of course your private property may be in danger. The cost of the LLC is relatively low and almost if not in all cases justified in the case of an investment. As non-real estate businesses choose to operate as a limited liability company to protect their shareholders, so is the situation in the case of real estate.

  6. I have a number of llc open in my name or I am a member of them. To date, there have not been too many "exceptional" cases in business management and therefore there has never been a need for this entity called llc (other than investor confidence).

    but !!!
    Another question on the same subject.
    I'm partnering with more 2 members (we hold multiple properties to rent), what else is a possible way to conduct such a business besides llc?
    Joint partnership under one umbrella, joint business bank account, insurance, etc.…

    The same question is true for the Flip deal.

    In the name of whom the transaction will be registered and if investors can participate if there is no company llc ??
    I would love to hear and learn.

  7. A story of a couple of my investors about a house that did not buy my way: Once a man crossed their grass and sat down the leg (or hand). He sued them for $ 50K.
    Didn't they have an LLC?
    But did they have insurance?
    What did the insurance do - negotiate with the plaintiff and close on $ 25K
    The story was told to me personally by the property owners about their home from both of them - meaning not a story of someone far away from them.
    The property was in the Greater Denver area.

  8. I have lived in the US for over 15 years and have been involved in real estate investments. The LLC question always arises, but always.
    Throughout these years, every opportunity I have, I look for the story (s) to show me how the LLC saved the situation.
    To date, I have only heard one story, and this story also does not really show how much an LLC could have helped.
    It is important to note that in all my years of activity I have lectured over 350 times in different rooms in different places in the US and delivered more than 400 webinars.
    I even brought in attorneys to talk about LLC and always without exception they sowed fear in the audience that they should buy their product / service.
    I also ask my colleagues in the field who have been investing for many years and have a lot of experience - I have not yet found the story.
    To this day I do not really have a story that reflects how much the LLC is the only “truth”.
    I am not for or against but argue that there is a lot of hype for the subject, lots of intimidation and implications that need to be understood if it is very important or just desirable to have an LLC.
    Also, many times investors forget or don't know that the LLC is not 100% protection and there are also situations where the LLC is not sure to protect the owner of the property.
    What’s important is: Let’s not put the LLC on an altar without understanding its full meaning.

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