I get asked a lot about protecting rental properties with LLCs. I have invested in a number of SFRs just like our friends at Blackrock (largest SFR owner in the US). I always protect my personal assets by having each rental property contained within its own LLC. The same is true for Multi-family and commercial properties that I own (even when there are no other investors). Granted my experience is in WA state, but it is pretty straight forward. Of course you can always pay someone to help you through it (I can help or you can work with my lawyer – details attached). If you want to do it yourself you simply need to prepare the forms and file them with King County.
You can get the forms from a few places. There are templates at the Washington State Bar Association. There are also templates available directly from the state. You can also put the document together using something like RocketLawyer.
You will need the LLC name, your name, the property address & legal description. Once you have the form prepared you can file with the King County Recorder’s office. The charge is $72 to file, plus $1 for every page after the first one (you should have it all in one or two pages).
As far as permission from the bank, I don’t usually get this. They generally want you to keep paying them so don’t complain about the transfers.
The leases are probably your most problematic component as you will need to go through transferring the lease to the LLC. Under Washington State law, the leases are transferable and the new owner (the LLC) must honor the terms of the lease. The process would simply be drawing up the transfer paperwork.
If you are investing SFRs as a means to retire early or put your capital to work while you continue your career, I would love to connect to learn more from your perspective and share some of mine.