Note that I do not put a lot of time into due diligence until the "contract to hold" meeting, when they put some skin in the game.At the "contract to hold" meeting, I collect an amount equal to one month's rent.

They have more skin in the game then you do.Make sure you get clear title.

It is super frustrating when you intend to invest your hard earned capital in order to provide safe and clean housing for people and in exchange you hope that the person will respect the place as it is theirs and pay you on time, but then the law is on the side of the person that has no skin in the game. 

Even banks want you to have some skin in the game.  

Here is how I think about structuring the partnership and I would like to hear your opinions:My equity partner will receive 40% of the profits for coming up with the 20-25% required for skin-in-the-game with hard money lenders.

Bottom line, this kind of seller financing is very difficult to complete and Close because banks, direct lenders, hard money lenders all want you the buyer to have skin in the game.  

You either need to find them yourself or work with a genuine wholesaler who finds great deals.If your contractor partner has no skin in the game they don't have much incentive to get things done and do them the right way.As enticing as this may sound, the downside is much greater than the upside.I tried partnering with a contractor on a house early on.  

The assessor is really the one who has the biggest slice of the pie, and no skin in the game. 

So now these investors need to trust a lead/sponsor/etc. with infinitesimally small skin in the game.Okay, that said, I’ve made more than a few assumptions to get to this point.

Offering an upfront deposit (earnest money) during the purchasing process shows you are serious about purchasing (the more deposit money you offer then the more serious you come across to the seller)...and from the sellers standpoint it protects their interests by forcing the buyer to have some skin in the game and making it less likely the potential buyer will just walk away from the deal and risk losing their deposit.