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Presenting an LLC operating agreement is required in most states during the acquisition of real estate. If the real estate being purchased will be owned by the LLC, it will be necessary to present an operating agreement prior to title transfer. Real estate LLCs generally involve private placements of securities, and U.S. securities law tightly controls the transferability of securities that have not been publicly registered with the SEC. In addition, the LLC’s operating agreement will often provide for rights of first refusal. This defines the right of the company, or of other members, to purchase any interests that a member would like to sell. The operating agreement of a real estate LLC usually provides that the manager will not be liable to the limited members for mistakes or errors in judgment that it made in good faith. Operating agreements used by in real estate LLCs generally follow a common template. The insulation from personal risk exposure for real estate LLCs, combined with the relative ease of administration and potential tax benefits, make ownership of investment property through an LLC a wise option in most instances.