How to partner with family

[Jesse Hodges]

I have a family member that is interested in being involved with my real estate deals. However, while I was thinking more of him doing private lending for my deals, he is more interested in doing deals as partners. What are some good ways to structure deals for a partnership for buy and hold rentals or BRRRRs?

[Nathan Gesner]

It has to be very, very clear about how profits are split but don't forget expenses and labor. Who's going to handle inspections or take the 11pm call about a clogged toilet? Who's reviewing the financials every month? When the furnace goes out, how are you going to split the cost of replacement?

It's important to have this all in writing with any partnership. It's even MORE important if you're doing business with a friend or family member.