Skip to content
×
Try PRO Free Today!
BiggerPockets Pro offers you a comprehensive suite of tools and resources
Market and Deal Finder Tools
Deal Analysis Calculators
Property Management Software
Exclusive discounts to Home Depot, RentRedi, and more
$0
7 days free
$828/yr or $69/mo when billed monthly.
$390/yr or $32.5/mo when billed annually.
7 days free. Cancel anytime.
Already a Pro Member? Sign in here
General Landlording & Rental Properties
All Forum Categories
Followed Discussions
Followed Categories
Followed People
Followed Locations
Market News & Data
General Info
Real Estate Strategies
Landlording & Rental Properties
Real Estate Professionals
Financial, Tax, & Legal
Real Estate Classifieds
Reviews & Feedback

Updated over 8 years ago on .

User Stats

27
Posts
11
Votes
Don Pham
  • Fort Lauderdale, FL
11
Votes |
27
Posts

Partnership vs private money on rental properties

Don Pham
  • Fort Lauderdale, FL
Posted

Hello,

Fairly new investor here. I've been house hacking for the past 5 years, so I have some minor experience in purchasing real estate and dealing with tenants. I was recently let go from my job and am currently self-employed. Most likely I will need to let my self-employment business season for another year before banks will readily approve me for conventional loans. In the meantime, I am looking to partner with someone I know to purchase a property cash. My question is, what is customary for such partnerships? We each would be providing half of the cash, but I would be doing all of the work (acquisition, rehabbing, managing, bookkeeping, etc). Like a 60-40 equity split? 75-25? Would it be better just to take the money as a personal loan? What would be customary for a rate of return (I was thinking like 8%).

Technically I have the cash to go solo on the deals I'm looking at, but I was prefer to own a smaller portion of more properties for risk mitigation. 

What're your thoughts?

Thanks!

Don