Pre-sale Renovation advice

[Tina Yassin]

Hello from Fort Worth, TX! I have a couple who wants to sell their home. The property needs a lot of cosmetic work and updates. To maximize their profit, it will be ideal to renovate the home and sell it. However, they do not have the money and time to deal with the renovation and they can’t get a construction/renovation loan. My husband flips home and I am a realtor. We wonder if we can cover the renovation cost for them and split the profit with the homeowners when they sell the house. Since I am part of the deal, to avoid a conflict of interest situation and to make calculating the profit clear and possible, we can have the property appraised and agree on a current as-is sell price. Anybody have done this kind of transaction? If so, what did you do to protect your investment and future profit in the property? Did you put a lien like a construction lien on the property? Did you hire a real estate lawyer to draft the agreement between the two parties. Any idea if such agreements already drafted and exist somewhere? I would appreciate any advice, input, and/or experience sharing. Thank you!