Structuring a deal

[Kent Lutz]

My buddy and I are partnering on a single family property. I am providing the down payment ($10k) and he is using his credit. He will be living in the home for the first 2 years, so he will be paying the mortgage for the time that he is living there. We have discussed a variety of options as to how to structure the deal once we turn it into a rental or sell it for a profit/loss?

Just 50/50 partners on profit/loss and cash flow of rent? Or should he have more "claim" to a bigger chunk of that because he has been paying the mortgage? On the flip side he is living there so you can't claim that he is paying "more" unless you claim he is living for free. 

Any suggestions? Thoughts?