A Limited Liability Company (LLC) is organized under applicable state law which creates a legal Entity with a combination of the legal and tax attributes of corporations and partnerships.
The LLC must:
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consist of two or more members, unless its single member is a corporation or LLC consisting of two or more persons or members;
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ensure that each natural person is of legal age as recognized by the state of incorporation at the time such natural person becomes a member;
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have a minimum term of existence of 10 years from the date of application; and
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provide for succession and continuance in the event of the withdrawal or death of a member.
A Series LLC is a specific type of LLC that is composed of separate membership interests, which are divided into individual series.
The Series LLC must comply with all requirements for approval of an LLC. The Series LLC must be organized in accordance with state law that does not conflict with FHA requirements.
The Series LLC’s operating agreement must stipulate that:
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no series may participate in FHA programs unless the approved Mortgagee owns 100 percent of the membership interests in that series; and
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the approved Mortgagee remains fully liable for the debts, liabilities, obligations and expenses of any and all series that participate in FHA programs.
For additional information see Handbook 4000.1 I.A.3.c.i(A)(2) and (3) available at: https://www.hud.gov/program_offices/administration/hudclips/handbooks/hsgh