It’s important to understand that, in spite of what some think, virtually no hard money lender wants the house.

Also weigh license verses purchase...I like owning mine.Trust Accounts. you most have one along with a general operating account.Fair Housing.

You would only need to update your operating agreement for the new brokerage office.

With labels, you can find people based on one or multiple markets they focus on, the various "occupations" they may have (eg. investors who are also commercial brokers), based on their experience, and so on.For example:I want to network with investors who operate in the Los Angeles and San Diego markets, who are landlords and who have flipped at least 3 homes, you can now do that on our FIND MEMBERS page using filters.Since the filters are brand new it will take a little bit for the data to get populated, but we will be adding new labels in the near future that will allow us to all better identify ourselves for potential partners and colleagues.I hope that helps.

With a Professional Managment Company, I won't have to manage day to day operations.

They have experience and good references.The problem with property managers operating on a "time and materials" basis with their maint. staff, is that, regardless of what they tell you, they have no incentive to hurry (in fact, just the opposite, to keep these employees busy at your expense).

Keeping the type of investment that you are doing will work great if you are planning on making this a more full-time operation.

Numbers below:Purchase price: $125,000Down Payment: $25,000Mortgage payments: $6,084/yr (PI $507/month @ 5% 30 yr)Rental Income: $16,200/yrVacancy 5%: $810Property Tax: $900/yrInsurance: $800/yrProperty Manager 12%: $1,900/yrMaintenance: $2,400/yr ($100/door per month)Utilies: $300/yr waterAdvertising: $200/yrTotal Operating Expenses: $7,310Net Operating Income: $8,890Less Mortgage Payments: $6,084Total Cash Flow: $2,806Cash on Cash Return: $2,806/$25,000 = 11.2%Any errors in my numbers?

Have you tried co-operating with brokers in the area and paying them half a months rent to find a tenant?

Dan,It sounds like your friend approached you and is already willing and able to invest with you, so I am not sure an "initial letter" is needed here.The most important part is your operating agreement if you choose to form an entity in which you both are 50% partners or a well written joint venture agreement if you use your own entities as partnerships.These contracts/documents should stipulate all teh duties of each party, death survival verbiage, insurance, and all details of the deal process.