All Forum Posts by: Bob Steward

The idea of having separate LLC's is to limit the liability of any one property to itself.

Dion,

I am aware of how mortgages work. I meant all the investment capital. That is, the money down for buy and hold properties that can float themselves via 50% rule.

The partner would not work full time, and this would not be a full time business but rather a long-term joint investment strategy. Basically, I can provide ~$30k-40k per year so if he could find 2 or 3 properties a year in the 50-70k range that we could invest in as buy and hold it would be a win. Property would be held in separate LLC's with separate mortgages. I understand that this is difficult (finding the deals, and getting mortgages in an LLC) but that is what the partner would invest as opposed to money.

Does this sound like a viable strategy?

Biggerpockets,

I'm researching forming an REI LLC with my partner where the responsibility breakdown would be I provide purchasing capital and he provides the actual boots to the ground work to find deals, execute, and do maintenance/landlord work on them (and find mortgages for us).

We're based out of the midwest so I figure we'll look into houses fitting biggerpocket's success models (50% rule etc) in the 50-70k range, ideally with mortgages that require 20-30% down.

What is a fair and appropriate ownership breakdown for the LLC? If I am providing all of the capital, and he is providing all of the elbow grease? Should it be 50-50? Something different? What is the best way to calculate my rate or return on my capital given partial ownership?

Thanks.