All Forum Posts by: Jonathan Farber

@Shawn Connors, this thread was sent to me by @Brad Farber as we love reading the forums.  We both agree this was one of the best RE business plans we have seen.  Great work and keep it up!

@Brad Farber @Jay Dertzbaugh @Troy H.@Steve Kontos

Very general question, but let's say a family member came to you and asked if they could invest 63K with you.  You can flip, you can buy and hold, you can privately lend - you can do whatever you'd like with the money.

What are people doing these days with chunks of cash?   

** Opinion question and not asking for what I should do with the money, curious what you guys would do :) **

@Adam Schneider @Levi T. @Chris K. 

@Bryan O. @Troy H. @Will Barnard @Lynn Currie

Thank you all for the feedback. To update/add more context: We did form an LLC and had a lawyer draft an operating agreement. The mistake looking back was that there was no clear exit strategy proposed other than criminal activity or unanimous liquidation.

Not having more clear exit options was a mistake.

Since this post, we have begun civil conversations around buy-out options.  It's shaping up that I will buy him out through a refinance and deed transfer as we had our names on both at the time of purchase (looking back this was another mistake).  We will be splitting the profits and hopefully remain friendly as we walk away.   A lot of lessons to take away on this one.  Thank you again for the feedback!

JJF

Hello all...any success stories or learning experiences from the group since original thread 3 years ago? I am an investor moving back to NY from the Raleigh NC area. Currently have 7 units but looking to grow the business here. Would love to connect with anyone on this thread!

@Jay Dertzbaugh

I'll preface by saying - I will speak with a lawyer and lender for the legal options but wanted to see if people had experienced anything like this firsthand.

6 months ago, a partner and I closed on a Single Unit Multi-Family in Raleigh, North Carolina.  The main reason I decided to go with a partner here was to help with down payment and at the time I believed he had a greater real estate/financial understanding than he did.  I also did not expect him to be this difficult to work with.  We entered into the deal, splitting the down payment costs, profits, and losses AND both on the mortgage loan.

Today, the property is cash flowing but there have been a lot of added complications working with this partner and difficulties added in things like the difference in opinion, strategy, management and so on.  

My main question is:  What are the best options to remove myself from this deal?  

We have gently brushed on the idea of selling but are still building cash flow 6 months into the deal.  Is there a scenario where he can hold me hostage in this deal if we cannot agree on an exit strategy?  

(Side note* I realize this is a fantastic learning experience, that an exit strategy is needed before the deal closes to avoid this in the future - that has not formally been discussed in this case).

All opinions welcome and thank you for the help!!!

Daniel, welcome. I too am scouting out metro NY areas as I consider moving back from Raleigh, NC. I have built a small rental business down here but understand NY is a different game. Please PM me to maybe review/ share some findings together. I have a few friends that are buying local foreclosures and had success with BRRR strategy. Good luck!

Hi Ashley, welcome to BP. It seems like a part of your question depends on how much you put down on the property. Have you analyzed the strength of any deals with some basic tools like cap rate and cash on cash returns? I like to usually understand these numbers before making an offer to truly know my cash flow numbers after the mortgage. Good luck! PM if you have any specific questions.

@Michael Norris Thank you for the fantastic reply.  Really great advice!!! Look forward to connecting further.