How would I make this partnership work. I have a co-worker that used to run a construction company and gas flipped several houses before but hates dealing with banks to get loans for the flips and construction. I would be able to bring most the money and help with most of the construction/remodeling of the house but I am not able to break down the cost of repairs and foresee things like he can when walking a home.
Also I am more wanting to do buy and hold were he is more into flipping. My question is would there be a way that we could buy a house fix it up and maybe do like a cash out refi and buy him out of his profit and me keep the house for a rental? How would that all work
Hey Joseph, I think you nailed it. You guys can be partners on the deal 50/50, or whatever you agree upon, you bring the money, he supplies the labor and when you cash out refi you buy him out at an agreed upon price. Or even simpler, don't make it a formal partnership, but simply hire him for the labor and construction at an agreed upon price and you can incentive him based upon a higher ARV upon appraisal. If the property appraises for higher than you thought, he gets a cut. That way, he can get paid for labor and you can own and hold RE. Hope this helps!
Yup, this sounds like BRRRR. When you refinance you'll cash out (and hopefully get your initial $$ out of the deal) then hold the property with renters and pay yourselves every month, win-win