Don't Transfer Property Into an LLC Until You Check THIS

Summary

A real estate attorney explains the critical steps and potential pitfalls for short-term rental hosts considering an LLC. The primary benefit of an LLC is limiting personal liability, creating a shield between your business assets (the property) and personal assets. However, the video's most crucial warning is about the "due on transfer" clause found in most mortgages. Transferring a property with a loan into an LLC without your lender's explicit permission can trigger this clause, allowing the bank to demand the entire loan balance be paid immediately. The attorney stresses the importance of maintaining strict separation between personal and business finances to prevent "piercing the corporate veil" and losing the liability protection an LLC is designed to provide.