Buying a Small Apartment and Have Questions

[Jorge Barboza Jr.]

Ok, so I am about to buy a small Apartment Building and am looking to partner with a friend on it. But I have a few questions that I would to get some advice on:

- Does it make sense if I am taking on a partner that we just split the ownership of the home by the percentage of the downpayment each of us put into the deal?

- If the above is true than what is the best way to go about that? Open a LLC and split up ownership that way or do tenant in common?

- If the above is true then how do you decide selling rights? By majority owner? Buy out of either owner possible by majority own approval and price determined by appraisal? 

- Any tips on what documents we need to make this happen? If it is a LLC that is easy enough but if not what docs should we use?

Thank you BP family. This will be my first partnership and first commercial deal so I am open to all other thoughts.

Jorge

#let-the-feedback-begin

[Kevin B.]

@Jorge Barboza Jr.

Tom is right, determine each player's roles and contributions, including time, talents, and money.

You may even decide to have one party active and the other passive. 

Most of all,  be sure to establish the "what ifs" should all not go well, like vacancies,  additional expenses, costs, and losses, disagreements among the partners, wishes to sell or liquidate when the other party does not, family succession, etc.

Everybody gets along great when times are great and it's a brand new venture.

Plan for worse case scenarios to both party's satisfaction before anything happens. 

Good luck!