I'm looking at buying a property as a BRRRR deal with another investor. We would be putting around $50k in the deal and then refinancing at about 65k ARV. He has the money to fund the deal and the costs, and I would put a couple thousand in and help with the rehab, as well as managing the asset. He would also help with the rehab when he had spare time. My question would be, how could we structure the deal? And how can he protect his investment? I don't know the process of protecting him in the deal but hear things like using a promisory note or joint venture agreement. What's the best/most usual way to go about this?
@Austin Hanse , a person w the money to do this can do it without you. What is your experience/expertise? What do you bring to the table? Do you previous pm experience? Business model or business plan?
The best way to protect all is a multi member llc. But when/if you create one, you need to agree, in writing, on the EXIT criteria. If no defined exit criteria, you chance of ending up in court are astronomical.
Are you planning on investing in Stl? Half the city is on a well-document nuclear landfill. Were YOU aware of that?
Best of luck!