Advice/Resources Needed: Form a Partnership or LLC?

[Emil Pinlac]

I recently spent some time catching up with an old friend via Zoom on our various business endeavors and how our careers since college have been going.

I told him about my recent RE journey and shared my investing strategy to jump into the Sacramento Real Estate market - specifically pursuing the "house-hack" strategy for my first property (hopefully a small multi-family) and doing some minor rehab projects on the units to force appreciation in a path to progress neighborhood. I would repeat this process, and hopefully build a strong enough income-generating portfolio that would also benefit from appreciation in the neighborhoods I would choose. I told him I am currently in the process of saving up for a down payment and do not intend to really buy until the end of the following year. 

He said he was very interested, and would love to go into business with me, with the intent to help expedite my down payment savings process, as he already has cash sitting on the sidelines. I told him that I had intended on creating a separate checking account for each of my forthcoming properties, and his suggestion was that we form an LLC so that we can expense items through that business.

Here is/are my question(s) for the community: 

1) Should we just be a Partnership, or form an LLC? 

2) What are a few key considerations I should be thinking of, when drafting our Business Contract?

3) Do you have any resources/books/websites/articles that can point me in the right direction with how to proceed with this? 

Additionally - I am looking at getting approved for an FHA or the HomePossible loan, so that I could take advantage of doing a low down payment via house-hacking, which would be great, as it would also allow me to better manage the property. He has no intention of managing the property, but would just like to put money in and be a business partner for the long-run as we build up assets. What are some other things I should be considering?