Partnership - Starting out

[Paul Bodnar]

I am in the beginning stages of investing in RE in the Baltimore market via fix and flips. I am planning on getting started with a partner who I have a working relationship with and trust. That said, I still want to protect my interests in the future. We are currently in the process of setting up a LLC with the intention of splitting profits 50/50. We are securing financing, viewing properties, and plan on pulling the trigger soon. I plan to have an agreement written up by an attorney to protect both sides, and would like some input on what to suggest/look for to be included in the agreement. A few more details..

1. - We both have a background in construction and is the aspect of the flip I feel most comfortable with. We will have no mark up on construction as we will manage labor/subs/material directly.
2. - We have established roles for starting out. This could obviously change over time but for the first few we are set.
3. - Neither of us will be paid for the process, instead taking money only on the back end (if at all), while rolling most of the money into additional flips.

I would like to hear input from others who have had similar arrangements with partners and the pros and cons they have encountered when doing so. I would like to protect my interest in this partnership while also keeping options open for other avenues both legally and financially.