What can I do to protect myself when investing in real estate?

On Behalf of | Aug 31, 2019 | Real Estate LLC Formation |

Starting to invest in real estate can be an exciting and exhilarating endeavor. It’s likely that when you are first starting out, you will feel overwhelmed with how much there is to learn. However, anyone can be a successful real estate investor as long as they are diligent and understand how to protect themselves from failure.

Any individual real estate investment has the potential to go wrong. As an investor, you are never able to fully control or predict the future conditions of the market. However, it is possible to protect yourself from personal liability if an investment does go wrong. The following blog outlines one of the most common ways to protect yourself as a real estate investor.

Setting up a Limited Liability Company (LLC)

By setting up an LLC as a real estate investor, you will be able to hold your investment within the company. As a result, if you lose money on the investment, this will not affect your personal finances. It’s common for real estate investors to set up a separate LLC for each investment they make. In this way, they are able to isolate risk.

You can set up an LLC for your real estate investment by filing articles of incorporation in Florida. You will then need to keep the LLC in good standing by having a registered agent in Florida and pay the business formation fees.

If you want to protect your personal finances from the outcome of your real estate investments, you should learn more about creating LLCs for this purpose in Florida.