Mutually Beneficial Partnership

6 Replies

Hi, A friend and I, are interested in partnering in his state TX to purchase investment properties. He has a newly built home in Austin and I rent in CA. He has the income to qualify for a loan and I’m 50/50, I’m currently working to lower my DTI ratio (currently around 45%) and I could potentially borrow from a family member but my return to them wouldn’t be immediate (I’m thinking a year or so after I refinance) He is willing to front 100% of the cost but how can we create a partnership that will be mutually beneficial. Is it possible that he does the financing and I can still be added to the deed? I’m thinking it wouldn’t make sense for a lender to not have another person to be held accountable for the payments. Any creative ways, I can assist? or recommendations on how to pay him back once the home is secured?

Bree Blades not to sound rude but in real estate you need three things deals, money and time. If he’s got the money and you’re doing the deals locally to him and not you unless he has no time I’m not sure what value you can add here. Can you find deals in Texas from San Diego? You can but that’s gonna be hard.

Also if your DTI is that high, depending on what type of debt it is, you really should pay that off before going into more debt to buy real estate. I’m a fan of all other debt (besides mortgage debt) being eliminated. No car payment, no CC debt, and no student loans.

Definitely value your opinion. Although he has the income, I have the knowledge, drive, and the connections. I actually motivated him to purchase his house, he didn’t want to buy a home.

It is definitely ideal to pay off all debt but I can’t keep waiting because I will always miss the boat. The only debt I’m concerned about is the credit card debt which is my variable in my DTI.

@Account Closed well that’s something and is probably worth 25-35 percent of a deal if your connections are really that good.

Still think you should pay off other debt first.  If you borrow from family (would not recommend this) then I would use that to pay of the high interest CC debt 

@Caleb Heimsoth yes, if I borrowed money from family, I would want to pay off my CC debt then I could also be able to get a loan but my DTI would be great! Thanks for your perspective and advice.

@Brees Blades. Suggest you consult with a Lender BEFORE you payoff the Credit Cards. Surprising as it may sound, paying off Credit Cards in some cases hurt your credit score.