All Forum Posts by: Justin Turpin

 This is great! Thank you!

This is a good point of view. That has been in the back of my mind. How is one to overcome that fear if they’re needing a partnership to get started? Just because you feel like you can trust someone in the beginning doesn’t mean they won’t screw you over. A good contract would definitely be a must.

I’ll admit, I do not know how to manage a property but how else do you learn without diving head first into it? My wife was a property manager for a company for about 3 years so Im hoping she’ll lend a hand with the paperwork. Debt collection is a small part of my W2 job along with my title of “service technician”. So maybe he’s confident that I can fix what breaks. 
Also the only reason I could think that he would want to pay 40% to a partner instead of 10% to a company is maybe he wants to be 100% hands off? I know the management company calls the owner in certain situations. I don’t know. I’m just speculating. That’s probably one of the main questions I have.
 

New here and still learning…

So I walk into a local store and meet the owner (super nice guy, late 50's) and get to talking to him for a while. Turns out he's a REI as well as a business owner in his hobby/trade. He's been in RE for the past 30 years.

I asked him how he got started in real estate since it’s something I wanted to get into (mainly multi family) and he said he had an investor that would pay for everything up front while he would manage it. They would do a 60/40 split on each property. He would do this over and over until he had enough cash to start using his own money to buy properties. He said hes good at 2 things and that’s what his business is and real estate and in all his years of being in it he’s never lost money on a real estate deal.

He told me if I’m ever interested he’s always there and he’d love to do the same with me as he’s always looking to spend money. He would put all the money upfront and I would manage the property. I told him I’d love to have that opportunity!

However, I don’t even know the “rules” for a 60/40 split. I didn’t want to get into the weeds of how the deal works and look stupid, what he expects of me (all the contract stuff) after the 2nd time meeting the guy so I figured I’d go home do some research and come back to him. From what I’m gathering it’s strictly buying then renting. No major flipping involved. It seems like a pretty common and straight forward deal but I wanted to hear how it normally works from you guys…?

Some questions I have - 

- What does he expect of me?

- Why wouldn’t he just buy a property and let a management company manage it for a 10% fee?

- Am I supposed to find the deal?

- Wouldn’t he be a better candidate of finding a deal with his experience?

- Do I pay for repairs?

- Is he buying the property with cash? If so is part of my 40% going towards a house payment?

These might be questions for him but I wanted to see if there was a norm on how to structure a 60/40 split. I’m sure he has the logistics figured out I just wanted to learn a little bit about what I was walking into. Any advice is welcomed!

My wife and I are looking at selling our personal residence this fall and starting the build of our new house. We both have W2 jobs. I want to dive head first into rentals as soon as the build is complete. However, instead of renting while our house is being built I thought, why not go ahead and purchase my first duplex/triplex and house hack it for a year. How will this effect me when I go to change from construction loan to mortgage? Cash is limited as it's going towards current home repairs and down payment for new house. Is there any way for me to achieve this? Am I being impatient? I know it will effect my good credit and debt/income ratio but not sure how much. I've been investing in stocks for about 10 years now but REI is new to me. Any advice is welcomed. Thanks.