We're looking to get into the rental market, which of these two should we do?

We're considering purchasing properties, renovating them, and putting them on the market as rental properties. Should we form an LLC to protect our personal investments and take out the loans for the houses under the LLC umbrella? or should we buy the homes as personal homebuyers to get better rates or incentives?

Doesn't matter the LLC won't protect you as much as you think.
The best way to do it is to pay CASH for the properties. Think about it what if you have a unit that isn't rented and you still have to pay the note on it. At least if it is paid for you're not shelling out cash out of your own pocket.

Well you have several different options. You can do an LLC and it will help protect you personally. You will need to purchase the properties in your personal name because of mortgage issues. Then you can sell or lease the properties to the LLC thus protecting you personally. If you try to purchase these properties in an LLC and get a mortgage in an LLC name you are probably going to have to put down anywhere from 10-20% cash even with a personal guarantee because it would have to be a commerical mortgage. If you buy it in your personal name you can get a non owner occupied 100% mortgage as if you were purchasing the property to live in yourself, plus by purchasing in your personal name you wil get better rates and terms.

Depending on where you live, what an LLC can do for you varies. I own four rental properties on my own and one with my brother. Our accountant said the only thing an LLC can assure is the equal disbursement of funds (tax returns, sale of said property) As for whether or not it can secure us from getting sued is anybodies guess in todays world

You definitely need an LLC for asset protection. You may also want to hold the property inside a land trust to keep your personal name out of the public records.

If you own the property personally and are involved in a civil suit you expose all of your personal assets (personal residence, autos, retirement accounts).

Form the LLC, you'll have better protection. You should talk to your attorney or tax advisor about it.

actually i would do both. buy property in your name only and buy it with the llc and have family do the same thing,. keep the better properties in your name so that you have personal expenses to off set your income and have advantage if needing a quick cash sale. also keep property in your llc name to off set any civil actions that may take place as these homes may be the border line homes and would more likely cause you trouble in either renting or selling and the LLC can use that as write offs. . but the main reason is # of real estate loans a person can have at any given time. you can own as much property as you like free and clear, however in most states you are limited to 8 non residence and 1 primary home that you can carry a note on. by having notes in your name and the llc you can double the amount of loans outstanding. Personally I would not want that many loans out but I know some real wheeler dealers who carry notes on forty properties or more. on paper they look good but if they make a misstep in the real world they could sink fast. so be careful in any choice you make.