Private Lender Or Partnership - what would you do?

[Tara Kinney]

So I'm blessed to work in a profession where I am in constant contact with higher earning people. I recently had a discussion with a collegue that is unhappy with his return in the markets (shocker...) and he knows that I have started investing my money into buy and hold real estate. He approached me and said he would be interested in investing money with me and be happy with an 8% guaranteed return. Now I personally won't purchase a property unless it provides me with a minimum of 12% COC return so this could potentially have a scenerio here where I could capitalize on a project without any of my own money out of pocket here and receive basically a free 4% (or higher) return without any of my own money down. Or...I could put my own money into some higher dollar projects as well. My goal this year is to purchase atleast 2 4-plexes or higher in 2019.

My question is, if you were given this option....how would you choose to structure a deal?  Partnership or private lender?  What is your reason?  How long would you structure a deal for?  I've personally not done a partnership type situation though I have done a private lender.  Just looking for some ideas/strategies that could benefit us both. 

And GO... :)

[Drew Lofgren]

@Tara Kinney I'm my opinion, working with private lenders is by far the easiest and most profitable. Private lenders are through and through numbers people. They generally have much lower interest rates and lower points. As long as the numbers work they will lend. I've worked in partner ships and rates can be anywhere from 10% to 60% depending on your needs. Hope this helps