Landlord Names (by Bern [VA]) Apr 8, 2014 11:25 AM
Landlord Names (by S i d [MO]) Apr 8, 2014 11:40 AM
Landlord Names (by Bern [VA]) Apr 8, 2014 12:26 PM
Landlord Names (by Mike45 [NV]) Apr 8, 2014 12:57 PM
Landlord Names (by S i d [MO]) Apr 8, 2014 1:10 PM
Landlord Names (by S i d [MO]) Apr 8, 2014 1:30 PM
Landlord Names (by Gary G [IN]) Apr 8, 2014 2:19 PM
Landlord Names (by Robert J [CA]) Apr 8, 2014 2:50 PM
Landlord Names (by Gail [MO]) Apr 8, 2014 2:55 PM
Landlord Names (by S i d [MO]) Apr 8, 2014 3:37 PM
Landlord Names (by Ken [NY]) Apr 8, 2014 3:38 PM
Landlord Names (by MikeA [TX]) Apr 8, 2014 4:24 PM
Landlord Names (by tb [IA]) Apr 8, 2014 9:04 PM
Landlord Names (by Patrick [IL]) Apr 9, 2014 9:46 AM
Landlord Names (by Patrick [IL]) Apr 9, 2014 9:49 AM
Landlord Names (by BRAD 20,000 [IN]) Apr 9, 2014 12:17 PM
Landlord Names (by BRAD 20,000 [IN]) Apr 9, 2014 10:40 PM
Landlord Names (by Gary G [IN]) Apr 9, 2014 10:47 PM
Landlord Names (by Dan [MA]) Apr 10, 2014 3:52 AM
Landlord Names (by Kevin 1,000 [MO]) Apr 10, 2014 10:25 AM
Landlord Names (by gevans [SC]) Apr 10, 2014 2:56 PM
Landlord Names (by DIXIE [K]) Apr 12, 2014 8:20 AM
Landlord Names (by James [MO]) Apr 13, 2014 9:27 AM
Landlord Names (by tb [IA]) Apr 13, 2014 1:49 PM
Landlord Names (by Mattie [TX]) Apr 16, 2014 6:02 AM
Landlord Names (by Bern [VA]) Posted on: Apr 8, 2014 11:25 AM Message:
State Specific Question About: VIRGINIA (VA)
My wife and I have a house we are going to lease for the first time. Is it best to have the landlord name be both my spouse and my name or just her name because she could be considered a woman-owned business?
Should we form a LLC instead? --69.255.xxx.xxx |
Landlord Names (by S i d [MO]) Posted on: Apr 8, 2014 11:40 AM Message:
Welcome, Bern. The question you've asked is a good one and there are several schools of thought on it. My advice will be based on the way I do it, and I'll tell you why I do it this way:
My wife and I formed an LLC and deeded all of our properties over to the LLC. When I sign a lease, I sign as an agent of "ABC Rentals, LLC". This way, my name and hers are kept out of the tenant's minds in case they decide to sue me some day. Not that it's difficult to find out who is a member of an LLC, but it's just one more layer between me and the tenant.
Also, by being a member of my LLC, I am now the "manager" instead of the owner. Owners get pestered for all sorts of favors, upgrades, etc. Managers say, "I'll have to ask the owner if we can do that." Make "the owner" the bad guy instead of me.
I'm not trying to hide, but I do like the extra layer of insulation an LLC puts between me and the tenants. At the end of a lawsuit, the LLC might not offer me much more than a different name to have in the court documents vs. my name--which is why I also carry a large liability policy.
More than anything, the less my and my wife's names show up in public records, the better.
I'm curious: what were you hoping to gain by making this a "woman-owned business"? The reason I ask is it probably isn't going to work. Land lords/property owners are typically viewed as investors for Govt/tax/financing purposes, which would include grants, loans and such. If your wife started a property management company called "Bern's Wife's Professional Managers" and she accepted pay for managing other people's properties, THEN you'd have a woman-owned business. So, without knowing what you were hoping to accomplish with that, I can't say for sure if you'd get any benefit from doing and LLC or not, but my guess is probably it won't make a difference. Banks don't loan money to LLCs without YOU signing as a personal guarantor. Ditto when wanting consideration for so-called "gender promotion of business ownership" via Govt. Can't think of any other reason why you'd want to have a woman-owned biz specifically... --108.250.xxx.xxx |
Landlord Names (by Bern [VA]) Posted on: Apr 8, 2014 12:26 PM Message:
Sid
You obviously have more than one rental property. Since we only have one and will most likely not have more for at least a couple years, do you still agree that the LLC is the way to go?
Other than the layers it affords you, is there any other protections that the LLC affords?
If we choose to save this initial cost, is there any problem with having both our names on the lease or should we only list one of us? --69.255.xxx.xxx |
Landlord Names (by Mike45 [NV]) Posted on: Apr 8, 2014 12:57 PM Message:
I thought you had come up with some original names, instead of "a$$hole", "skinflint," and the usual epithats that we get pelted with.
Bern, I disagree with Sid on the LLC issue. I don't think an LLC provides extra protection against a competent attorney, if you are hands-on managers/handymen/etc. Sid and I both agree that a large LL insurance policy is essential!
My wife and I recorded a Fictitious Business Statement so that we are legally on record as doing business as ABC Properties. All of our leases are done in the name ABC Properties.
--184.6.xxx.xxx |
Landlord Names (by S i d [MO]) Posted on: Apr 8, 2014 1:10 PM Message:
Bern,
It depends on your goals. Do you want to do everything reasonable and cost-effective to shield yourself from lawsuits and liability? Will you sleep better at night knowing there are 5 layers between you and potential disaster or 6 layers?
In Missouri, it costs less than $100 to set up an LLC. This is a one-time fee and there is no additional cost of any sort whatsoever. That's chump change. Even if all it does is throw an ambulance chasing lawyer off me for 1-2 days, I'll say it's worth it. But again, I also carry $1 million in liability insurance so IF something bad happens and I get sued and IF I am found liable and IF the judge decides I am personally responsible, THEN I have a ton of insurance to cover me.
The name of the game for me is taking cost-effective steps to limit the fall out of a potentially life-changing legal suit. An LLC is just ONE STEP in the game of many steps.
Btw, I have followed the LLC & liability insurance concepts since I started land lording in 2005. Even just ONE unit is enough to create liability should the worst happen. In my mind there is no "magic number" for deciding when an LLC and liability make sense. It always makes sense to me. Some folks sleep okay at night taking a loosey-goosey approach and might not carry either one or both (no liability insurance, no LLC), and they might save a few hundred $$$. Okay, well and good for them. As for me, sufficient insurance and legal structures provide peace of mind.
I suggest you talk to your attorney so he/she can explain the pluses and minuses from your state's perspective. I'm not a legal expert, nor do I know your state's laws, so any advice I give is worth exactly what you paid for it.
To reiterate my view on whose name(s) to put on: anyone whose name is on the lease is an automatic target if someone tries to clobber you. I recommend acting according to that viewpoint. Let THEM have to WORK to find you, if necessary.
In other words, what benefit do you get from putting both your names on the lease? What are the potential downsides? Just like everything in life and business, gotta think thru the pluses and minuses. I cannot think of a single "plus" to having your wife's name on the lease, can you?
Last suggestion (and the simplest): if all of this is confusing you and/or giving you heartburn, just go get $1 million in liability insurance and it won't really matter whose name(s) is/are on the lease. 95% of the cases that go to trial involving mom and pop land lords settle for less than $1 million...so it doesn't really matter. --108.250.xxx.xxx |
Landlord Names (by S i d [MO]) Posted on: Apr 8, 2014 1:30 PM Message:
To address Mike45's point: I do not believe ANYONE should be crazy enough to just get an LLC and call it good. It is simply ONE STEP in a multi-step approach for asset protection. Local judges, state laws, court decisions, how you operate, etc. will ALL play a role in whether or not an LLC does you any good. For me, $100 cost and 15 minutes of time to set it up. Even if it is only a 2 mm thick blanket, it's still SOMEthing vs. NOthing. But at the end of the day, the liability insurance is probably 100 times more important, as is acting in a professional, businesslike manner, knowing and following your state's laws, abiding by the Golden Rule, etc.
So...whether you do an LLC (or not), I'd get liability insurance in place FIRST. Then, after consulting with a local, experienced, land lord/tenant attorney in your area, decide if the LLC is worth it or not for you. My local, experienced (over 35 years in biz), VERY successful attorney (his firm has over 20 associates, multi-million dollar business that represents big name clients all over SW Missouri), says it's worth it to do one. I pay for his advice and follow it.
--108.250.xxx.xxx |
Landlord Names (by Gary G [IN]) Posted on: Apr 8, 2014 2:19 PM Message:
Bern, There are many different views on this topic, I agree with Sid and I know Mike45 disagrees, and that's ok.
So to answer your question, Do you put both your name and your wife's name on the lease? If you do and you file for eviction, you both would probably have to take off of work and go to court. If there is only 1 name, only that person has to go but you bot can go. Screen your tenants better and don't take a bad tenant because it is better to have a vacancy than a bad tenant. If you had a bad tenant, you would wish you had a vacancy. good luck --99.132.xxx.xx |
Landlord Names (by Robert J [CA]) Posted on: Apr 8, 2014 2:50 PM Message:
Let's get real for a moment. You and your wife are going to be dealing with tenants and issues. Also of concern is the way you hold title to the property. There for you need an insurance policy that names you, your wife and the owners of the property -- examples: Your Family Trust, You and Your Spouse are the named policy holders or listed as additionally insured.
You may want to also get an umbrella policy for extra liability.
I remember my friend, a licensed real estate agent, putting his properties in an LLC. When a tenant got assaulted because the front security electronically controlled door was broken for the Nth teen time, my friend got sued in his personal name, not the LLC, owner of the property. His insurance realized this on the way to trial and dropped his defense because the wrong party was sued, his insurance was worthless. --98.119.x.xxx |
Landlord Names (by Gail [MO]) Posted on: Apr 8, 2014 2:55 PM Message:
I bought a foreclosed trailer park that had a bunch of junk mobile homes. I advertised them for $300 to $800 and they went fast. Anyone who needed axles could rent them from me for a deposit of $100, and get their money back when axles were returned. One family was returning the axles, when the dad turned to walk away, he tripped over on of the axles and fell. His wife looked at my employee and asked, "does the owner carry liability insurance"? My employee quickly responded "no", and the people got in their car and drove off. I truly believe that if they had been told "yes", I would have gotten sued. Insurance is no more than an invitation to a lawsuit. --75.120.xxx.xx |
Landlord Names (by S i d [MO]) Posted on: Apr 8, 2014 3:37 PM Message:
RobertJ, that was your friend's insurance agent's mistake. My policy names the LLC as the primary and my wife and I as additional insured parties: again, per my attorney's advice.
Gail...do you carry liability insurance of any kind other than what MO mandates for car drivers? I agree there are SOME nit-wits who would sue on a lark just because they think there's money to be made if you have insurance and won't sue if they think you're broke, but the risk is far worse--in my opinion--of having someone get injured on a property and having no protection if they win a large judgment. Insurance companies don't like to pay out big $$$, so to say insurance is an invitation to a lawsuit discounts that their lawyer will do everything in their power to reduce and/or eliminate liability. If you lose, they lose. The legal defense the insurance company will mount on your behalf alone would be worth it, especially if it's a high-dollar medical case. --108.250.xxx.xxx |
Landlord Names (by Ken [NY]) Posted on: Apr 8, 2014 3:38 PM Message:
I agree 100% with Gail,I was sued many years ago for lead poisoning,my insurance company dealt with it and paid a lot of money,now most policies do not cover lead poisoning and when the lawyers find out you don't have lead coverage you never hear from them again.I had a slip and fall accident at a property and got a letter from a lawyer asking about insurance coverage,we called and told the attorney we had no coverage and never heard from him again.I believe exactly what Gail said,if you have insurance you will get sued --24.92.xx.xxx |
Landlord Names (by MikeA [TX]) Posted on: Apr 8, 2014 4:24 PM Message:
don't use an LLC, we put the lease in both my wife and I's name. Never had a problem with a judge requiring both of us to be present. --107.202.xxx.xxx |
Landlord Names (by tb [IA]) Posted on: Apr 8, 2014 9:04 PM Message:
To be clear, if I dont set up an LLC but the property is in my wife and daughters (who also is a tenant) name, if I call it "xyz properties" on the lease but name xyz, my wife and daughter as well as myself on the insurance policy, since I will be managing it. Is that adequate?
So im saying is it ok just for the lease to say xyz properties" ??
Or do I need to list my self as mgr as well?
Thoughts? --207.177.xxx.xxx |
Landlord Names (by Patrick [IL]) Posted on: Apr 9, 2014 9:46 AM Message:
Just want to share my experience... I always put my business name on the lease for the reasons that Sid mentioned. It also looks more professional IMO. I agree with most people here; you should get an umbrella insurance. It'll be your first line of defense. A coverage of a million or two is pretty cheap.
Good luck, --198.29.xxx.xxx |
Landlord Names (by Patrick [IL]) Posted on: Apr 9, 2014 9:49 AM Message:
Oops, I've got it wrong. Umbrella insurance will be your 2nd line of defense after the judgement amount exceeds the liability coverage of the property/auto. --198.29.xxx.xxx |
Landlord Names (by BRAD 20,000 [IN]) Posted on: Apr 9, 2014 12:17 PM Message:
Bern, I'm sure your head is spinning because mine is!
Let's keep this simple and get your rent flowing.
36 years and well over 20,000 rent checks talking:
-even with just one rental I teach to be SAFE and busineeslike.
Start a good business relationship with your prospects and residents by being the MANAGER, never the OWNER. Managers can tell residents NO when necessary, and it WILL frequently be necessary. Res will walk away frustrated.
When the res feels he is talking to the owner he will argue and fight, even slash your tires. Not exaggerating. Don't be afraid, just be safe and smart.
Keep your wife and kids safe.
Deadbeats seek out new mom&pop LLs to scam. A business name and being the manager will slow that.
-use a generic business name like Superior homes or Redbud Rentals, not your own name or initials.
- sign he lease with aN UNREADABLE scribble and the words AS MANAGER
-i never tell them my last name. They don't need it.
-never use your home address or home phone. People get weird or have dangerous relatives that might hunt you down when you have to evict.
-LLC you can get the home rented and lease signed now then set up an LLC later.
-when you are ready I recommend a MANAGEMENT LLC separate from the ownership of the property LLC. Worry about that later
- very important: get to the National Convention in May and learn to do this right from the start. See the home page here at MrL. Worth the effort! --67.175.xx.xxx |
Landlord Names (by BRAD 20,000 [IN]) Posted on: Apr 9, 2014 10:40 PM Message:
Sorry about the TyPoS!
I did that post with my thumbs on my iPad.
It all passed spellcheck. --67.175.xx.xxx |
Landlord Names (by Gary G [IN]) Posted on: Apr 9, 2014 10:47 PM Message:
Brad 20,000 is THAT your business name on your properties? Brad 20,000 --99.132.xxx.xx |
Landlord Names (by Dan [MA]) Posted on: Apr 10, 2014 3:52 AM Message:
LLC, Trust, DBA's - they can all be debated. What is hard to dispute is the fact that tenants will treat you better if they think you are just the property manager. It's you and them fighting against the evil owners for whatever it is they want. So for that reason alone, I would suggest you separate yourself in someway from blatantly being the owner. DBA or a simple trust is a easy way to start without adding a lot of cost. Make sure your insurance covers all parties. Get a P.O. box and never ever put your home address on anything - there are a lot of crazy, vengeful people out there that should not know where you live. --64.197.xx.xx |
Landlord Names (by Kevin 1,000 [MO]) Posted on: Apr 10, 2014 10:25 AM Message:
Downside of LLC in my jurisdiction is that for LLC-owned properties you need to have a lawyer representing you in court.
LLCs are really designed for passive owners not active managers. --128.252.xx.xxx |
Landlord Names (by gevans [SC]) Posted on: Apr 10, 2014 2:56 PM Message:
Pretty much agree with Sid and BRAD.
Our properties are in LLCs. However, this is a small town. It's a simple task to find the owner of property through the internet. In my case, the county records show owned by ABC LLC, but they also show the tax bill goes to my name and address!
I ALWAYS present myself as the Property Manager, employee of ABC Properties.
Many times I've had the tenants agreeing with me that the board of directors must be a bunch of yahoos, but we still have to do what they say. --74.222.xxx.xxx |
Landlord Names (by DIXIE [K]) Posted on: Apr 12, 2014 8:20 AM Message:
My husband and I have both our names on the property, but only my name on the lease because I would be more available to sign lease, go to court, etc, than he is. We used to have both names on but this is a lot easier.
No have properties in LLC. No reason. Just never got around to it.
. --70.195.x.x |
Landlord Names (by James [MO]) Posted on: Apr 13, 2014 9:27 AM Message:
There is a point to an LLC, but for most people it's going to be a waste of money.
That LLC is going to have to be operated correctly, because if not, the LLC veil can be pierced by an attorney, and you will be sued personally (you will be anyway).
It's very easy to find out the owner of a property. If it's an LLC, it's easy to find the organization documents etc, find out who the members are. If your LLC, fictitious name, corporation are not registered with the state, they are illegal. The process of registering gives away the info.
If you were going to have your properties in an LLC, using the same rationale, you would be nuts to have them all in one LLC. One lawsuit gets all your properties. You're going to need multiple LLC. With multiple LLCs your life just got way more complicated and expensive.
Actually a trust should probably own your properties, a beneficiary of which is your LLC. That hides a little better. But don't ever think an attorney can't just pull you into court and ask you about the ownership, and you will have to declare in court what that is. I would recommend you not lie.
One thing that always irked me is having to pay an attorney for an eviction. Because in my state, if you are an LLC, Corp, Trust, etc you will have to hire an attorney. I've had something along the lines of 40 evictions, so that's something $12K I would have had to spend if my properties were in an LLC.
Finally, my wife and I jointly own all of our properties. The tenants know we own them. This has not been a problem for us. People always say it's better to be the "manager" than the "owner". We don't do that. We haven't had all the issues that everyone says you'll have if you own the property yourself. We turn things down all the time, and explain to the tenant why. It simply takes some personal growth. No one like to be unpopular, but sometimes when you are in charge you have to do something unpopular. We're not afraid to that.
Having said all that, we're getting old enough that we may go against what I just said above, and add some properties to an LLC, because it will be easier to pass along to our daughters than to simply will it. We're in the thinking stage now.
BTW, the only time we had a corporation at one time so that we could flip properties and not get stuck personally with the dealer issue. We're not flipping anymore, so we disbanded the corporation.
--65.27.xx.xxx |
Landlord Names (by tb [IA]) Posted on: Apr 13, 2014 1:49 PM Message:
So does it matter what name I put on the lease then regardless of how its owned?
SFH owned personally (by my wife and daughter but I will manage it) but planned to call it abc property or something. .... is it fine just to put that on the lease only? --207.177.xxx.xxx |
Landlord Names (by Mattie [TX]) Posted on: Apr 16, 2014 6:02 AM Message:
James (MO) said:
"BTW, the only time we had a corporation at one time so that we could flip properties and not get stuck personally with the dealer issue. We're not flipping anymore, so we disbanded the corporation."
Can you explain what dealer issue? --66.160.xxx.xxx |
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