Skip to content
×
Pro Members Get
Full Access!
Get off the sidelines and take action in real estate investing with BiggerPockets Pro. Our comprehensive suite of tools and resources minimize mistakes, support informed decisions, and propel you to success.
Advanced networking features
Market and Deal Finder tools
Property analysis calculators
Landlord Command Center
ANNUAL Save 54%
$32.50 /mo
$390 billed annualy
MONTHLY
$69 /mo
billed monthly
7 day free trial. Cancel anytime
×
Take Your Forum Experience
to the Next Level
Create a free account and join over 3 million investors sharing
their journeys and helping each other succeed.
Use your real name
By signing up, you indicate that you agree to the BiggerPockets Terms & Conditions.
Already a member?  Login here
Starting Out
All Forum Categories
Followed Discussions
Followed Categories
Followed People
Followed Locations
Market News & Data
General Info
Real Estate Strategies
Landlording & Rental Properties
Real Estate Professionals
Financial, Tax, & Legal
Real Estate Classifieds
Reviews & Feedback

Updated over 6 years ago on . Most recent reply

User Stats

2
Posts
0
Votes
Luke Anderson
  • Minneapolis, MN
0
Votes |
2
Posts

Silent Investor in BRRR

Luke Anderson
  • Minneapolis, MN
Posted

Hello,

I am a relatively new real estate investor.  I've flipped two single family properties for rental - both were 80% sweat equity.  I have come across someone my same age who is interested in being a silent investor.  He's done minimal investing, so we are both new at this. 

He wants to do a "trial run" on my next single family home.   I expect this to be a 5-7 year investment - i.e. rent and then sell.   We are challenged with identifying equity and cash flow split. 

Property Purchase Price: $182,000

ARV: $265,000

Cash to Close: $35,000

Repair Costs: $30,000

I'm expecting to cash flow $400-$450/month (Rent - mortgage payment)

What would be reasonable for him to expect from a cash flow return and an equity split?

I was thinking of giving him a minimum 5% return on his $10k investment + a 15% split on profit.  His expected return would be about 9%.

He would get a 7.5% equity split at property sale - if that 7.5% was less than $10k, i would supplement the difference as long as equity payout did not exceed 85/15 split. 

Loading replies...