Private Money - How to pay ?

[Jonathan B.]

Hi Guys-

I have a fix/flip project ongoing and there's a friend who's looking to get involved (passively) and lend money,

I wanted to know what is the standard compensation for these cases?

i want to make it worth while for him,

I expect to have a total profit of 15K out of this flip-

He is looking to invest 50K out of an Aprox. 100K Project

I was thinking of offering him 30% of the profit which equates to around 6%-8% on his investment,

Am i over/under paying according to the common lending standards?

I realize its a matter of what is comfortable for me - Wanted to have a view of what other people's view on structuring such deals

In addition - Considering having paperwork invovled, even though its a friend and there's trust there too - still could be a good lesson for me -  any good resource as to what type of contracts should be drafted?

Thanks