how do I form a partnership??

[Patrick Wilson]

I have a good friend that wants to do this real estate investing flip strategy with me how do I form a partnership with her? Whats the best way?

Thanks

[Hattie Dizmond]

There will probably be as many opinions on this as there are potential answers to that question. It all depends on what level of rigor and documentation you guys want or need to be comfortable. I know people heavily involved in REI that do everything on a handshake. I have 2 partners. They are my closest friends. They have the passwords to my online banking accounts...literally. I trust them with my life, and they trust me with their kids. (That's about the highest honor a parent can bestow in terms of trust!) We have a formal LLC, including a 15 page operating agreement that spells everything out.

We have that, not because we needed it to be comfortable with each other or the partnership.  We have that in place, because they have families.  Should something happen to one of us, we needed to ensure that their estate planning needs were covered.  (I also wanted to ensure they were protected from the crazy in my family, should something happen to me!)

You can do flips pretty easily on a handshake and verbal agreement.  If you're doing buy & hold and want to keep the paperwork to a minimum, you could simply title the property to a land trust that designates what each of you have as beneficial interest in the property. 

It can be simply or it can be complex.  What is right for you and your situation?  There are plenty of threads on BP already that talk about why one type of entity is better than another in a certain situation.  Figure out what your goals and needs are, before you jump into structuring a business.