Real Estate Lawyer question - Flip Transaction

[John Morgano]

There is a property a friend of mine (known for 25 years) that has a construction company in the Northern VA area that works with high end homes (initially roofing business, but now into everything). He came upon a good off market deal in the University Terrace NW, Washington dc neighborhood.  These homes are old but the neighborhood is flipping to multi-million dollar properties.  He can get this property for about 1 million (because of land), another 800k - 1 million for the build and sell for potentially 2.5-3 mill.  He already has permits, build plans, cash needed ($400k cash reserve for monthly payments to the bank), etc.  He mentioned to me there is NO money whatsoever I need to come to the table with but needs a partner for bank purposes with W2's.  He has multiple projects and if he gets a partner with W2's with a certain amount of gross income, then the bank will give the complete loan.  

He offered me $100k at the sale of the property 8-10 months build time just to be a partner and literally do no money for the deal.  Has anyone done something like this? I would need a real estate lawyer for this.  I know if defaults that I'm on the loans as well, but I know he has the money and saw what he has and has guaranteed me he's got all the payments.  Once this first transaction goes through, I'm sure he'll want to partner again as the banks will see he has the first house for sale going forward which would make things a bit easier. 

This neighborhood is a hot area in DC and we want to get in on the hot market while it lasts... even though DC area seems impenetrable with the housing crisis's.

Thoughts??

[Russell Brazil]

Make sure the ARV is on, understand length of project and length of sale process at this price point. 8-10 months seems very quick...you said he already has permits...but Im not sure how hed get those if he doesnt own the property yet.