Private lender equity structure for flipping

[Tripp Wylie]

Me and two other partners are flipping houses locally and are using a local individual for the financing. We’ve done a few deals to prove things out and so far so good.

The structure has been we are loaned the money at 0% but the lender is getting a big chunk of equity. Deal #1: 70%, Deal # 2: 50%.

The lender is using a line of credit at 8%, so he does have interest expense, but not passing that on to us.

Really my question is, what’s a long term structure that makes sense for both sides?

Lending at 0% is great but is 50-70% too much equity per deal?

Is there a structure that makes more sense?

Should we offer preference and less equity?

Thanks!