Doing business with a friend

[Rahiem Bush]

Ok so I have a coworker who's looking to buy a home in the same area I've decided to invest in he's getting a mortgage in his name and asked if I would be willing to put up half the down payment and split the cash flow between the two of us has anyone done this do you have any suggestions any horror stories any success stories. It's a small initial cost $5k I'm not sure it's allot to loose the place will cash flow at close to $2k a month once rented so worst case scenario I make my money back once or twice and then loose a friendship. 

[Shawn Ackerman]

@Rahiem Bush I think it's a great idea. If the property is in queens be sure to check with the zoning board about living the basement, even if it's the owner. Two means of egress/ceiling height/window height etc....should be correct. Also get all of your ducks in a row legally as this sounds like an infinite COCR deal after only a few months of owning especially going the FHA route wherein the down payment is only 3.5% of the purchase price. The thing that sucks about buying in NY state are the landlord tenant laws on the books. Look at the deal from all angles. Sounds like you've mitigated your risk significantly by only being a silent partner. You may want to consider having you added in a junior lien position with a set dollar amount that you both can agree on. All the best to you.