Funding from Friends and family

[Eric Schrader]

Hi group.  I have listened to almost all of the podcasts (some more than once) and in several instances the guest identifies that they asked friends or family to help them raise the required down payment for an investment.   

Assuming the bank will have the 1st lien position, how do you set up the down payment contract?   Is it a plain promissory note  with a specific interest rate or do you offer them the 2nd lien position on the title?

Anybody have any real life examples they could walk me through?

thanks as always.

eric