Mortgage company could enforce “due on sale” clause—not very likely. I have never seen it happen. But it exists in part based on the previous bullet point. If they see that property ownership has changed they can call the loan due to protect their investment. But as long as payments are being made it’s not likely. I have a saying “everything is good until it isn’t.”.

An LLC cannot take advantage of the tax code allowing an owner to defer taxes via a 1031 exchange upon sale of the property.

If you set up an LLC first and try to purchase property in the name of the business, it can be very very difficult and you will not get the same benefits of acquiring a loan in an individual’s name. Typically, a commercial loan must be paid over 15 years instead of 30 years and interest rates are typically 1%-4% higher and often with higher closing costs. One of the benefits of purchasing single family residence properties is you get these benefits. Commercial real estate requires commercial loans. Commercial real estate typically is any property with more than 4 units.