JVing with people with no cash but good credit

2 Replies

So here's my situation-

I've slowly built a decent portfolio with decent cash flow.

I'm starting to run into roadblocks primarily with my DTI being too high to lend on.

I've got plenty of cash on hand.

Seeing my success many friends have asked how they can "invest" with me or get started in real estate.

Many of these people have little to no cash on hand.

My question is can I leverage their interest in real estate as well as their good credit to JV a deal.

As an example-I front the cash for the deal, we cosign on a loan, they pay me back the cash for the down payment through the cash flow of the property.

I win because I have more cash flow, they win because they get into real estate with no money down.

Would a bank do something like that ?

***I understand the risks associated with consigning a loan.

Thanks for your input.


"Slowly building a decent portfolio with decent cash flow" seems like a solid business plan @Brit Foshee . One thing you should consider is getting in with a local bank that has a commercial lending department. You want to put a package together that shows your track record of steady growth. They will see past the DTI ratios and your cash on hand will show you are a responsible borrower. You need a bank where you can have a conversation with the underwriter/decision maker. Big banks like BofA won't care about your situation but local banks will appreciate the relationship.

Getting friends to invest can be a great thing but I would think you would be looking for their cash and your expertise so you are getting in with no cash out of pocket, investing their money, and you are getting a piece of the equity (hopefully at least 50%). 

Your situation with your money being invested could certainly work but I think the goal is usually to get in with little or no or at least "less money down". 

What's your banking situation like now? Who do you work with? Local banks? Big banks?

Best of luck Brit.

@Rob Beland

Thanks for the feedback.   I agree with the idea of getting in with as little cash as possible. 

I also appreciate speed... That's why if I structured the deal properly, I could have my cash back within a year to two max. 

Let me propose a hypothetical situation.

Me and a partner purchase a $100,000 SFR. I put up the $20,000 and we cosign on a loan. The property rents for $1500. For arguments sake, lets say the property throws off $1000 a month in cash flow.

I essentially write a note for $10,000 to be collected 100% from cash flow. (They don't receive any cash until  I am paid back)  I can get as creative as I want.  I can charge interest on the note... I could take a bigger equity stake 60/40.  I could make the note the full $20,000. 

For me this would be a true win/win.  Person gets into real estate with no money down.  Downside for them is that they have to wait to start receiving cash flow.  

I get to gain additional cashflow that I wouldn't otherwise be able to without an equity partner with better DTI.

I appreciate the dialogue.  Keep the thoughts coming!


Free eBook from BiggerPockets!

Ultimate Beginner's Guide Book Cover

Join BiggerPockets and get The Ultimate Beginner's Guide to Real Estate Investing for FREE - read by more than 100,000 people - AND get exclusive real estate investing tips, tricks and techniques delivered straight to your inbox twice weekly!

  • Actionable advice for getting started,
  • Discover the 10 Most Lucrative Real Estate Niches,
  • Learn how to get started with or without money,
  • Explore Real-Life Strategies for Building Wealth,
  • And a LOT more.

Lock We hate spam just as much as you

Join the Largest Real Estate Investing Community

Basic membership is free, forever.

By signing up, you indicate that you agree to the BiggerPockets Terms & Conditions.