All Forum Posts by: Account Closed

Sorry all I haven't been on biggerpockets for a couple years now and lost track of this post. As an update to our business structure:

Partner and I each acquire properties in a single partner's name. We usually trade off who is "purchasing" the property. We do this instead of acquiring in an LLC to take advantage of low interest rates with Fannie backed mortgages. We generate a JV agreement that lays out the structure for that deal. Depending on who brought what money and what we decide as our exit strategy each JV might be slightly different.

we have a joint LLC that is our management company. Our management company performs all duty's related to renting and property management. We are both members in this LLC.

I understand this strategy has its fallbacks and limitations but it works for us for now. Hope that helps!

Epic Property Management. I have not used them but I hear great things about them.

@Matt Souza, my partner and I have a similar structure to what you are looking for. We also were contemplating buying properties in a LLC but decided against it for the reason you mentioned about lack of conventional financing and it would potentially make things a little messy down the road if either of us wanted to free up capital.

We decided to acquire properties in one of the partners name and generate a joint venture agreement for each property. To help with liability we both purchased large liability umbrella policies. If you read around this site or talk with other investors you can read the arguments on if an LLC is required over a good umbrella policy. We chose for now to go with the umbrella policy method, maybe we will shift that in the future.

We did (in the process of) creating a LLC to function as our property management entity but no properties will be acquired under this LLC.

It is on a SFH

If you can make the numbers work in Plymouth for a rental, personally I would absolutely make it a rental. As you know, you will have no problem renting it out and when you are ready to liquidate it you will have no problem doing that as well. If you don't need the cash right now for something else what is holding you back?

im not to sure what your requirements are for investor friendly but I have my first property under contract and am working with Lake Michigan Credit Union and they have been great and offer the best rate/terms.

Thank you all for your input! It's great to see the different ways to structure the partnership/deal. Like with investing, there are many ways to approach this topic. Please feel free to continue to share how you have structured your deals, I know I am very interested and seems like this is something others would benefit from as well.

@Mark Rickert Thanks for your input!

I need some advice on structuring a partnership on buy and hold deals.

I am a new investor and have decided to partner up with a good friend of mine on starting our real estate journey. We both currently do not own any investment properties but have similar goals in real estate. We both want to acquire a portfolio of rental properties. Our target is the BRRR strategy but at the end of the day we are looking for solid assets that will cash flow.

I bring the drive, vision, and investing knowledge to the partnership while by partner works for a property management company so has experience with all tenant related aspects, is a licensed broker and has access to MLS, and has contractors he trusts (we have yet to use them for personal projects). We both bring equal capital to the partnership and do not have enough capital individually to execute a deal (currently).

We originally were going to acquire all properties in a joint LLC but decided that might get complicated in the future when either of our investment goals change. We have pivoted and decided that each partner would purchase a property individually with the other partner acting in a JV role.

We will still work as a team and help each other out with whatever needs to be done with each others properties.

My initial thoughts are to set the deal up where the partner not purchasing the property provides a sum of capital for rehab/purchase with a fixed return (10%?) and terms and also receives a percentage of the cash flow for help managing.

My question is:

How have people in a similar situation structured their JV agreements?

Are there any books/resources that I could read to learn more about structuring deals like this.

@George P. I was afraid that might be the answer! They always say to invest close to home and I believe these 3 zip codes were the best fit but like you mentioned there just isn't anything on the MLS. I am looking for my first property and really eager to buy just can't find the right place. I might have to expand my search area but then I start getting into areas I'm not as familiar / comfortable with.