Arrangement with Contractor

[Justin Melton]

I had an acquaintance contractor approach me last year about loaning him money to fund his flips.  He did several and I believe they were very profitable, he just didn’t have the cash to purchase these homes and to fund repairs ect.  He is someone that I do trust, but had never loaned anyone money like that and the timing wasn’t right.  

Now I am wanting to purchase some investment properties and think he would be a good fit to use as my contractor.  Question…should I just have him be my contractor or could we partner on some deals-I put up the money for property and/or repairs then we split some equity in the property or some arrangement or am I making it more complicated than it needs to be.  Thanks in advance for any ideas or strategies that could be a win/win for everyone! 

[Jonathan R McLaughlin]

@Bruce Woodruff from what I know of you from posts would definitely have done that deal :)

How did you determine fair rate on the labor--yours and the subs--and parts? What kind of mark up if any? In other words, trying to figure out how you structured the ongoing costs and margin while doing 50% split