Quote:
Originally Posted by slow4dr
The one thing I have been really thinking about lately is starting an LLC for the rental property. Many of the regulars at biggerpockets have recommended starting one for any rental venture. The problem I see is that technically you will need one for each property. What are your thoughts about that?
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Sorry -- I thought you were asking about investment LLC's.... you're asking about asset protection.
Be very careful about the intended use of LLC's for asset protection when you are the sole control. They don't work very well for cases like that. Be certain you get a lawyer and tell them what you're trying to do. Listen carefully to his response.
My advice is to simply carry an umbrella policy for liability. They're very inexpensive -- and more importantly - since the carrier doesn't want to pay out - they will defend you as well. Look at your coverage as the more you have the less the carrier will want to be liable for - so they'll defend more vigorously...
If you have a 1MM policy somebody will sue you for 2MM -- the insurance company is only on the hook for a mill... big whoop.... but if you have a 10MM policy - somebody will sue you for 20MM and that puts some deep hooks in the carrier.... and they're going to work hard to not have to pay out and certainly don't want to pay out 5 or 6MM even in a settlement! So they let the dogs out!
