All Forum Posts by: Cal Harty

Dwelling Fire (DP3) thru Foremost for our rental which is owned by an LLC, $1,700/yr. Real deal policy not a homeowner policy with a rental rider.

280K dwelling

40K personal property 

60K loss of rents 

500K premises liability 

10K medical payment per accident 

Thank you both. That's helpful. My partner said we could consider doing 10-30% profit per deal until all capital originally contributed is recouped if it's a concern...that could work for me too. His ultimate goal is to build up though to do more and more deals and bigger deals and eventually have rental properties to offset gains of flips. A good strategy I suppose! 

We do have a bookkeeper and someone drafting Operating Agreement/LLC he's comfortable with thank you though Courtney!

Hi,

A friend and I are going to start a real estate flipping LLC, he's done 100s and owns a larger GC compan, I'm newer to it. We are beginning by contributing 100K each and future capital contributions will be 50/50 however profits will be 1/3,1/3, 1/3 because his business partner is his brother who handles all the logistics etc. I am essentially just a silent partner but also help scout new properties so find this agreement fair.

For operating agreement my concern is liquidity, I like the idea of at any time getting back my contributed capital. Profits I can understand perhaps only set intervals like every 6 months or if not a penalty to access whenever. I guess the idea is you want some disencentive to access the money too much too often? He thinks of it more of a long term play whereas I do too but also like the idea I could access my $$ if I wanted/needed to. Am I missing something?

Also, since we get 1/3rd profit but I'm down for 1/2 contributed capital, any tricks on that for accounting/tracking purposes? If all goes well before long the LLC bank account is going to have a lot of money in it beyond each of our original contributed capital, of which we are entitled to 1/3 of each.