How do you work with your investors

4 Replies

I'm talking to potential investor partner to rehab homes. They will put up cash and go on the loan. i will find project, and do all the work

Is there an accepted split that most people are getting when working with investors.

What would be fair competitive split right now?

In past I saw deals done with 25% equity going to the general partner after return of principal, preferred return paid to investor, and interest paid for equity to partnership.

I've seen some partnerships with a 50-50 split, but it was usually one partner with the money and who was finding the deals and taking care of all the paperwork, and the other partner doing all the labor of remodeling. Expenses of materials and carrying costs were repaid and then profits were split.

Originally posted by "Ryan Webber":
I've seen some partnerships with a 50-50 split, but it was usually one partner with the money and who was finding the deals and taking care of all the paperwork, and the other partner doing all the labor of remodeling. Expenses of materials and carrying costs were repaid and then profits were split.

This way works good for people just starting out. Less of a headache and financial strain of having the carrying cost. Just make sure you have a solid contract with the investor.

In my case I will find the deal and do all the work ie using contractors if need be. The investor will put up the money and go on the loan. I think I will do it as a LLC company.

I see splits along the line of 60/40 with the working partner getting 40a.