How do you structure a deal with an investor?

[Claudia Papa]

I'm a new investor as well as a real estate agent. I'm looking to invest in multi families to create monthly cashflow. I'd like to know what are the best ways to structure deals with investors if I'm bringing the deal to the table? Would 50-50 be fair? Also, should the investor be on the deed? 

[Michael Ealy]

If the investor is bringing the entire thing - cash - and you don't get financing, 50-50 is more than fair. In fact, one can argue, you should give up MORE equity because your investor is taking on all the risks.

If however, you qualify for financing and the investor brings in the 20%-30% equity, then you can do 70-30 (in your favor).

You can also structure it as combination of debt and equity just to make the deal sweeter for the investor.

If you and the investor are buying the property 100% cash, the investor can get 6% on his money as debt and at the same time, be a 50% owner of the property. If you structure it this way, the investor can be the mortgage lender with you as borrower and the title is in the name of an LLC that you and the investor own 50-50.