Can I get a real estate loan in an LLC?
Yes, most investment and commercial real estate loan types, including DSCR, bridge, hard money, and bank commercial loans, allow or prefer closing in an LLC, with owners of 20 to 25 percent or more of the entity personally guaranteeing the loan. The LLC holds title and signs the note, but you remain financially responsible through the guarantee, and the lender will still review your personal credit and financials.
Which loan types allow LLC vesting
| Loan type | LLC vesting |
|---|---|
| DSCR loan | Preferred by most lenders |
| Bridge loan | Allowed, usually preferred |
| Hard money | Allowed, usually preferred |
| Fix and flip | Allowed, usually preferred |
| Bank commercial loan | Standard |
| Agency multifamily | Standard, often required |
| SBA | Allowed, entity structure reviewed carefully |
| Conventional owner-occupied mortgage | Generally not allowed; must be personal name |
What the LLC needs to provide
- Articles of organization or certificate of formation.
- Operating agreement showing ownership percentages and signing authority.
- EIN confirmation letter.
- Certificate of good standing from the state.
- A borrowing resolution authorizing the specific loan, often on the lender's own form.
Why the guarantee still applies
Closing in an LLC does not eliminate your personal financial responsibility on most loan types. Members owning 20 to 25 percent or more typically sign a personal guarantee, meaning the lender can pursue your personal assets if the LLC defaults and the property sale does not cover the balance.
Forming the LLC before you need it
Most lenders accept a newly formed entity, though forming it before the purchase contract is signed, rather than scrambling right before closing, avoids delays. Form it in the state where the property is located unless there is a specific reason to do otherwise, since an out-of-state entity often needs to register as a foreign LLC in the property's state.
One LLC per property or one for several
Many investors use a separate LLC for each property to isolate liability, while others use 1 entity across several properties. Both approaches work with lenders; the choice is more about your own liability and tax planning than lending requirements.
Moving an existing property into an LLC
Transferring a property you already own personally into an LLC after the fact can trigger a due-on-sale clause with your existing lender. Refinancing directly into the LLC's name, rather than transferring the deed separately, avoids this problem.
How CommFi handles it
Our lending desk collects your entity documents alongside the application and structures the file so the LLC vesting does not slow underwriting. It funds direct when it fits, and when the desk searches a database of 7,000+ lenders, LLC vesting is standard practice across nearly all of them. Zero upfront fees.
Related reading
Related questions
- Can I get a real estate loan in an LLC?
- Yes, most investment and commercial loan types, including DSCR, bridge, hard money, and bank loans, allow or prefer it.
- Do I still personally guarantee a loan if it's in an LLC?
- Yes, if you own 20 to 25 percent or more of the entity, you typically sign a personal guarantee regardless of the LLC vesting.
- Can a brand-new LLC get a loan?
- Yes, most lenders accept a newly formed entity as long as all required formation documents are complete.
- Should I use a different LLC for each property?
- Many investors do, to isolate liability per property. Either approach, 1 entity or 1 per property, works with most lenders.
- Can conventional owner-occupied mortgages close in an LLC?
- Generally no. Owner-occupied consumer mortgages require personal vesting; LLC vesting is for investment and business-purpose loans.
Property developer and licensed appraiser. 22+ years in real estate: TIC conversions, multi-unit redevelopments, mixed-use, fix and flips, commercial DSCR.