💼 LLC vs. Personal Name: The Smartest Way to Title Your Investment Property in 2026 🏠

💼 LLC vs. Personal Name: The Smartest Way to Title Your Investment Property in 2026 🏠

🏢 Should You Buy Real Estate in an LLC or Your Personal Name? Investors Need to Know This ⚖️

💼 LLC vs. Personal Name: How Investors Should Title Their Properties When Financing

Choosing whether to title your investment property in an LLC or your personal name is one of the most misunderstood parts of real estate investing. And it matters — not just for asset protection, but also for financing, rates, approvals, taxes, and long-term portfolio planning.

As a mortgage broker who works daily with investors across Texas and the U.S., I can tell you this:
There is no one-size-fits-all strategy.
But there is a smart way to structure your deals depending on your goals.

Let’s break down exactly how investors should think about titling their properties when financing in 2026 and beyond.

🏢 Buying in Your Personal Name: Pros, Cons & When It Makes Sense

✅ Advantages

• Lower interest rates
Conventional and DSCR lenders typically offer better pricing for loans closed in personal names.

• Easier approvals
Lenders can underwrite your credit score, tax returns, and income directly — often resulting in smoother approvals.

• Better long-term financing options
30-year fixed rates, lower DSCR minimums, and streamlined refinances are usually available.

❌ Disadvantages

• No liability protection
If something goes wrong at the property, you are legally exposed.

• Harder to assign later
Transferring title into an LLC after closing may trigger lender due-on-sale clauses (though many do not enforce this if payments remain current).

⭐ Best For:

• First-time investors
• Investors needing the best rate
• DSCR loan borrowers
• House hackers and small multi-unit buyers

🗂️ Buying in an LLC: Pros, Cons & When It Makes Sense

✅ Advantages

• Strong liability protection
Your personal assets stay insulated from tenant or property-related claims.

• Cleaner bookkeeping
LLCs make it easier to track expenses and manage multiple properties.

• Professional credibility
Banks, partners, and contractors often view LLC-owned real estate as more sophisticated.

❌ Disadvantages

• Higher interest rates
Commercial and LLC-titled loans can price higher than personal loans.

• Larger down payments
Many lenders require 20–30% down for LLC-held assets.

• More documents
Operating agreements, EIN, and organizational paperwork are typically required.

⭐ Best For:

• Investors with >2–3 rental properties
• BRRRR investors
• Partnerships
• Investors prioritizing asset protection
• Portfolio loans and blanket loans

⚖️ The Financing Truth Most Investors Don’t Know

Lenders prefer you close in your personal name — but you can often transfer the title into the LLC after closing.

This gives you the best of both worlds:

✔️ Lower rates
✔️ Easier financing
✔️ LLC protection (after the transfer)
✔️ Keep the loan in your personal name

Investors call this the “close personal, hold LLC” strategy, and it is one of the most efficient ways to build a portfolio.

🧠 How I Advise Investors at Medallion Funds

Every investor’s situation is different.
When we build a financing plan, we evaluate:

• Are you building a long-term portfolio?
• Do you need the lowest payment possible?
• Are you using DSCR, bank statement, or conventional financing?
• Are you planning to cash-out refinance later?
• Is asset protection or borrowing power more important today?

With the right strategy, you can finance in your personal name and build your liability protections around your LLCs at the same time.

🏁 Final Takeaway

If you want the best rates — close in your personal name.
If you want the best liability protection — hold in an LLC.

And with the right lender, you can do both.

If you want to structure your portfolio the smart way, reach out and I’ll walk you through options across DSCR, conventional, bank statement, and commercial loans.

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© 2023-2024 Bill Rapp, Medallion Funds LLC, Director of Capital Advisory