Updated about 8 years ago on . Most recent reply
How to structure a deal with friends/family
In order to come up with the approximate 60k (dependant on the percentage) needed for down payment. I'm going to have to get creative. How do you structure a deal between friends/family? How much do you ask for, what do you offer them (term and return), and how do you deliver their money back to them?
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Hi Mearl! There are a lot of posts on this. My best advice is that once you work out the business terms, have a good lawyer draft an operating agreement, or a mortgage or note, or whatever method you decide to take so that you don't end up with ex-friends later. A good operating agreement should anticipate most of the things that could go south and solve them without you having to figure things out as they arise, which can get ugly.
As far as what to ask for, do you intend to find the property, manage it, renovate or make repairs, pay all expenses, hire lawyers and accountants, find tenants, etc.? Or what will your role be? Are you looking to have them hard money lend or get an interest in your LLC? There are TONS of ways to structure so it really depends on your specific needs and situation.