First Rental Property...What Next??

6 Replies

I am looking for my first rental property to invest in!

I have a financial partner that is wanting to invest with me, she doesn’t want to do any of the work...just reap benefits. She is a cash investor so I won’t be needing any loans or credit. Feeling blessed!

I am starting my real estate license course next month. I am not experienced or seasoned in the market, so should I be looking to hire on an agent/broker/property manager etc?

My plan is to get this first property with my cash investors help, save up 6 months worth of mortgage then start putting the rest of the money away for a future property.

I've never done this before so what kind of % is normal to work out with a partner for them to get their money back plus some interest? She would be more interested in staying in the deal to keep reaping benefits and not just get her money with interest.

Should I go 50/50 with her? I will be doing all of the work except for putting money down.

Any advice or help is greatly appreciated! Super excited to get started.

Just finished reading Rich Dad Poor Dad and have started on Brandon Turners “Rental Property Investing” and it has changed my life lol!

@Kinsie Huskins the first major decision is to figure out what strategy you are going to pursue and it's hard to do that without a fair amount of education and research. Do you have a clear investing strategy yet? How much time have you spent of BP reading forum posts, researching, listening to podcasts, how many books have you read, etc? Regarding your question: it's a fairly common structure to have a capital partner funding a deal and a boots on the ground partner who does all the work with a 50/50 split on cash-flow and equity upon the exit, especially since you both are not experienced. A more seasoned investor would likely utilize your contact as a lender rather than an equity investor but there's no rule that says you can't grow together as new investors. However, based on your post alone I can tell you are not quite ready. Keep educating yourself and continue to ask lots of questions. That's where most (all?) of us start!

@Brian Gerlach

Thank you for your response! I do in fact have a whole plan in mind and on paper. Goal is to invest in my first property by August of next year with my lender. Until will continue to educate myself and ask questions.

@Kinsie Huskins  I would create an LLC. Divide ownership of the LLC by calculating total cash investment by the members. Give each member an ownership stake equal to his cash investment. Two members contributing $25,000 apiece would each receive a 50 percent stake in the company. If you feel you are doing all of the leg work then you should try to add that into the ownership split.

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