Partners for Flipping a house

[Albert Martinez]

I have an investor that would like to partner with me on flips. He wants to be a silent partner and wants to put in half the money to purchase and rehab but does not want to do any work. I will be locating, purchasing, rehabbing, and then selling the property, he will just provide capital. I need the capital he is providing in order to do some of my deals. How do you guys go about splitting the profits in this type of partnership?

[Mark Bookhagen]

He is only putting 50% of the capital needed (without working), and you are putting up 50% + the "work." Personally, I think the work is worth 50% and the 100% of the money is worth 50%. So from what you've told us, you are putting 50% of the capital, which gives you 25% of the profits; he gets 25% of the profits for 50% of the cash, and then you get 50% of the profits for doing all the work. So you would get 75% of all profits, and he would get 25%. That's what I'd be looking for if I were in your shoes. You may not get it, but that's what I'd want.