Deal for a friend. Does this make sense?
My friend just came to me asking if this deal made sense. I told her what I thought, but I wanted to know what you all thought as well to see if there's something she or I are missing.
A friend of hers came to her saying that they found a property in Colorado for a good deal and wants to partner on it to sell it later down the road and split the profits 50/50. This possible partner has been investing in real estate for 15+ years and has done 100's of millions in sales. The deal they're proposing is as follows:
This possible partner would bring $5k down, found the deal, will manage the rental and will take care of all documentation as they're the real estate agent.
My friend would bring $16k down and the property would be under her name using her credit since the possible partner has said that their credit is maxed out and they can't add any more properties to their name.
I was thinking that it seems like a pretty fair deal, but my friend was just feeling weary about it since she has to use her credit. She's done a few deals but not near as many as her possible partner.
What do you guys think?