Real Estate Investor · Plymouth, MA · Member since 2014 · 29 posts · 0 votes
So, I've read a bunch of the search results but can't seem to find anything that answer's my question:
What is a good deal to offer a private investor. I'm looking for 30% of up to $700K, basically to fund down payments. From an investor's prospective, does it make sense to put up a down payment and own that percentage of the property, risk and all. You get 30% of what it produces after all expenses.
I'm assuming there would need to be some sort of exit strategy or buy out provisions written into the deal, such as no buy out for first 5 years but after that, it's at appraised value?
What are the common arrangement that you have used either as silent partner or general loan?
Rental Property Investor · Milwaukee, WI · Member since 2013 · 6k+ posts · 4k+ votes
12y
Typically private investors don't fund long-term buy and holds. From everything I've seen you'd need to cash someone out within 6-12 months. However, there are always exceptions and you may find that exception.
Investor · Austin, TX · Member since 2013 · 452 posts · 309 votes
12y
Hi Mark,
I think the answer is, "it depends."
My first thought would be, why do I get only 30% of the income if I'm taking all of the risk?
These are things that I would ask if I was investing. The answers can influence the amount of risk the investor is willing to take and the amount of returns they would expect to see:
Real Estate Investor · Plymouth, MA · Member since 2014 · 29 posts · 0 votes
12y
Thanks. I've got to think it through some more. If I'd have to cash someone out in 6-12 month, seems like I'd be better off pulling equity out of another property. I can see cashing out on those terms on a flip but I'm looking for down payments for B&H investments.