How to Structure a Flip Partnership

[Laura Costello]

Happy to say that I have a friend/colleague  who is ready to invest $150K no interest for 6 months and we will be doing a flip.  The cash advance will be on a simple loan document, not secured by the mortgage of whatever flip property I find.  I will find the deal, manage the rehab, market and sell.  We have not determined how to split the profits.  This will be my 6th investment property and I am looking at flipping something closer to the 200K price looking to sell for 300K so I will also have my funds as well as all of the work into the project.  What I am asking from the BP community is what they see working best for splitting profits....usually 50/50...60/40...does it change based on the amount of profit, etc.  Please share your thoughts and experience with me.

Thank you,

Laura

[Timothy Maloney]

@Laura Costello - Call me greedy but why not borrow and flip it yourself?   The 10k or so in loan fees will be far cheaper than a 50/50 or 60/40 split.    To flip a 300k property in the scenario above you could do this with as little as $25k- 30k...

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