Thoughts on splitting equity with partner?

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This is my first deal on a house I will not live in. I have found an off-market deal that will allow me to gain instant equity and apply the BRRR method. I have a friend who is looking to invest in the deal and an attorney I trust to draw up the paper work. I'd like to leverage my friend's capital, but I'm not confident about the best way to do so. I'm looking to get the contracts finalized ASAP. Here are the details:

After months of research, I found an owner of a house that last appraised at about 105K. The owner is aging and is willing to sell me the house for the price of her remaining mortgage, 37K. She also wants to continue living in the home and taking care of it as her own after I purchase the home for $300/mo under the condition that I pay for a life insurance policy that covers her final expenses and leaves her children a few bucks. This rent is much less than market value, but all things considered it seems fair. She takes immaculate care of the property inside and out, although some cosmetic repairs are needed. The house is three bedrooms and 2.5 bathrooms. With some renovations the basement could be turned into another bed and bath (the bones for both are present). My friend is interested in contributing $10,000 - $15,000 to the deal.


If I buy the house cash and use a friend's $10,000 in capital for renovations, what is a fair % of cash you might offer out of the refinance money? Are there some other ways you might plan out this deal?


So you're finding the deal, dealing with the seller, managing the property, figuring out the life insurance policy, dealing with her heirs eventually, using your cash for the purchase. And your friend is giving you 10k for repairs? Giving equity for that is a raw deal for you. If you want pay your friend 10% interest on their 10k go for it, no way does your friend deserve an equity position for that contribution. 

Long term have you thought about what happens if the current owner lives another 10, 15, 20 years? That $300/mo isn't going to cover your mortgage, insurance, and property taxes, much less any repairs that come up.