OfflineI have an investor that has offered to split cash flow of properties we find together. I am just curious if there are DG'ers out there that have such partners and how you structure deals together.
Any advise, recommendations, etc greatly appreciated. My wife and I have neither cash or credit to get deals done and have been hoping for such an investor to partner with.
I would like to set up a proper relationship so that our future deals run smoothly.
He likes to manage his own properties, doesn't want to invest out of the state.. ( I have a great deal in Iowa, prob 2) but we are in California.
He wants to cash flow properties, but it seems tough to find those in San Diego. We currently have a realtor that is searching for cashflowing properties.. but then doesn't that just make us a suedo realtor if we are just passing MLS listings to him?
How does someone with no cash or credit become a valuable asset to a person that has both?
-Chris and Kether Sprague
“I do not think much of a man who is not wiser today than he was yesterday.” -Honest Abe Lincoln
Want off market sellers to call you? I think writing letters to vacant home owners is a great marketing avenue. I have vacant homes in every state! With the owners address! I want to partner with other wholesellers. If you are interested, please PM me! -- This is how I got my first deal, and I will give you leads and help you build your/our team! if you don't have them already.
Our investor friend wants us to manage the property, but we have never been prop managers. I never envisioned being a property manager, but I suppose I should know some of the dealings of one.
I always wanted to have several properties, enough that I know I would rather just pay a prop manager to do that for me.
I have subleased a house before to others... but still wondering where I would start to make sure I was a good property manager, if and when we put a few of these deals together. thoughts?
-Chris and Kether Sprague
“I do not think much of a man who is not wiser today than he was yesterday.” -Honest Abe Lincoln
Want off market sellers to call you? I think writing letters to vacant home owners is a great marketing avenue. I have vacant homes in every state! With the owners address! I want to partner with other wholesellers. If you are interested, please PM me! -- This is how I got my first deal, and I will give you leads and help you build your/our team! if you don't have them already.
I have been avoiding them like the plague;) but our investor friend likes the HOA because they "mow the grass" and paint the house every 7 years or so. Oh well..
He has an interesting way to evaluate an opportunity, that I havent really thought of but it seems to make sense.
He wants to make 10% on the down payment of 20% of the purchase price each month, and is open to up to 8 plex purchases. So if you have an opportunity in San Diego CA I would be happy to split a deal with you.
seems like buyers are not the hard ones to find though.. it is the motivated sellers.
-Chris and Kether Sprague
“I do not think much of a man who is not wiser today than he was yesterday.” -Honest Abe Lincoln
Want off market sellers to call you? I think writing letters to vacant home owners is a great marketing avenue. I have vacant homes in every state! With the owners address! I want to partner with other wholesellers. If you are interested, please PM me! -- This is how I got my first deal, and I will give you leads and help you build your/our team! if you don't have them already.
A few suggestions in working with partners:
1) The best partnership arrangements are those where there is a 50/50 ownership, because both partners have equal say in decisions. Often it is possible to balance cash investment on one side with labor on the other. If at all possible, try to work for this balance.
2) Have a written partnership agreement in addition to whatever entity you form. The partnership agreement outlines responsibilities and how and when each person is paid, and penalties for non-performance, etc.
3) Begin with an agreement to work on one property together, set it up as a joint venture under a jointly held entity. Create a finite ending to the obligations on the property where the property must be sold or one partner buys out the other within 3 to 5 years. Do NOT agree to buy more properties together until you have been through a year or more of operating one property together. Bad partnerships usually do not start to become bad for several months, and you do not want to turn bad to worse by becoming even more linked together until you have tested each other out to see how you perform. The money is not worth the misery of a bad partnership.
4) You are always free to amend your original plans by mutual agreement and if the partnership goes well, you can expand it.
Dallin Wall
Real Estate Training Team
Forum Blog Location--A collection of my
"Best of" posts:
http://www.deangraziosi.com/blogs/dwall