LLC Vesting
What is LLC vesting?
Holding investment real estate in a Limited Liability Company rather than in your personal name. Provides liability protection and asset segregation.
“Vesting” refers to how title to a property is held — whose name appears on the deed. LLC vesting means the deed (and the underlying mortgage) name a Limited Liability Company as the owner, rather than an individual. The LLC’s members (you, and any partners) own the LLC, and the LLC owns the property.
For real estate investors, LLC vesting accomplishes two things conventional ownership cannot. First, it provides liability protection: if a tenant slips on the sidewalk and sues, the suit targets the LLC’s assets (the property and its cash), not your personal house, savings, or other investments. Second, it provides asset segregation: holding each property (or small group of properties) in its own LLC means a problem at one property doesn’t cascade into your other real estate.
Conventional Fannie Mae and Freddie Mac mortgages do not allow LLC vesting — they require the property be titled in an individual’s name. This is one of the core reasons serious investors graduate to non-QM lenders.
How LLC vesting applies at Total Quality Lending
Total Quality Lending’s DSCR loans are designed for investor lending and permit a wide range of vesting structures:
- Single-member LLCs — one individual owns 100% of the entity
- Multi-member LLCs — partners (spouses, family, or business partners) co-own
- Layered LLCs — one LLC owns another LLC, then the property
- Series LLCs — a parent LLC with multiple isolated series holding individual properties (where state law permits)
LLC vesting is also available on Multi-Unit DSCR and Foreign National DSCR. TQL does require all members (and a personal guarantor) to be disclosed and credit-checked, and the LLC’s operating documents become part of the underwriting file.