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Updated over 7 years ago,
Silent Partnership Structure
Structure:
50/50 Ownership of new rental property
Partner A: Qualifies for financing and puts down the 20% required down payment. Gets 10% return on his 20% down-payment year after year..
Partner B: Finds deal and does all the work to oversee coordination of financing, managing the leasing of the property; Does not contribute to downpayment
Question: Do you think is it reasonable or fair to structure a real estate rental purchase where a silent partner is responsible for the entire down payment as long as they get a 10% return on their downpayment OR, should the silent partner also be repaid that 20% downpayment on top of their 10% return (like a pref return on their 20% down payment)?
I understand partnership structure can be done any way and there is no one way to do it, but I wanted to see if anyone else thought the above was reasonable.