Investing 40k in flooded homes Baton Rouge denham Louisiana

[Gregory Thompson]

Will be receiving money through an inheritance. I will more than likely be investing with a friend of mine flipping flooded homes in denham springs, Baton Rouge Louisiana. What do I expect with the return. Would my investment be able to be withdrawn after a first flip considering I don't do more with him. Or would my investment/profit be stuck in real estate? What kind of security paper work should I do before handing over hard cash. Once again, I am just a lender. He is pretty much in charge. I trust him with his decisions. We would go dollar for dollar on the flip and the return would be 50/50

[Brandon Johnson]

@Gregory Thompson if your partner is doing flips now with private lenders then he should be able to explain the process to you that he typically goes through. I presume you are lending the money to acquire the property in which case you would have the title company draft a collateral mortgage and a promissory note which could also cover the rehab funds if you are loaning that also. Try to keep your total exposure to no more than 65-70% of the ARV of the house. It is important that you understand those ARV numbers to make sure you are getting into a good investment.

The mortgage is what will secure your interest and the promise to repay.  You may also want to have the attorney draft a partnership agreement to spell out the terms of repayment when the property sells since there is profit sharing involved rather than just a loan to be repaid with interest.

If you don't already have one, I could recommend a good title company that does this type of transaction all the time.  They are located in BR though.