Posted by Patrick on March 26, 2006 at 21:12:34:
Buy them as an individual if you want them to cash flow. Lenders will look at them as commercial loans if they are under a corp/ LLC
Should I Incorporate? - Posted by Eric Nichols
Posted by Eric Nichols on March 26, 2006 at 20:03:13:
I am a recent graduate and I am going to begin buying single family and multi-family homes and renting them out. My credit score is 749 and I have $10,000 cash. My question is should I buy these houses as an individual or create a corporation? Any advice would be appreciated.
Thank you.
Re: Should I Incorporate? - Posted by John Corey
Posted by John Corey on March 27, 2006 at 03:10:03:
Eric,
There is a book by Bronchick that covers this subject.
There are multiple issues. Liability, credit history of a brand new company/corporation, short term vs. long term hold and the tax impact.
One reason to have an LLC or similar is to address liability. The other view is if you have little to lose what is there to protect.
If you can not find the book (costs about $20 on Amazon and is a summary version of the longer home study course) let me know. I can not remember the name but I know I can find it if I was to look around.
John Corey
PS. Check out the legal forum. I am confident this question has been discussed there.